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My mortgage company contacted me an offered me the option to refi under the VA streamline program. I just refinanced under the same program 7 months ago with them for a lower rate of %4.750, reducing my mortgage payments $ 224. I was very pleased with them in July 2011 and am enjoying the lower payments. Yes, that refi reset my loan payments after 2 years of living in the newly purchased home in 2009. My concern is I have not paid that much towards principle since the last refi, so doing it again now would reset the clock a second time adding roughly $ 5k in fees on top of my loan balance. Just looking for some professional advice on this, thanks.
To the first poster. My original APR was %5.2 and dropped to %4.7 which was the VA rate at the time of this streamline program. I have a VA loan and my FICO is a 740, no large debts at that time but a new car in April 2011 and a deferred student loan for $ 8k. So my credit was a non factor. However with the laon balnace being close to max, my debt to income ratios has to be high at this point. The program required a 620 credit score to apply. Now being offered another refi with the option to drop my payments $ 172, which would decrease my mortgage to roughly $ 1436 from $ 1606. I am facing rates as low as %2.3 now. The loan funding fee is waived due to me being a disabled vet. The total closing costs on that refi 7 months ago was roughly $ 5k. I just need to know if this is really worth it. I am leaning towards passing, but a lower monthly payment is really tempting.
@ loanmaster

Thank you for the insight and advice on this matter. I totally understand and will weigh my options of the closing costs vs the recoup value. At this point I trust my mortgage broker, because he has helped me in the past with honesty and excellence. However, I think I will sit tight and hold what I have with the current payments.

Thanks for being Proud Veteran in Arms!!

SSG/Military Police Core

3 Thoughts on Should I refinance a 2nd time after 7 months ago?
  1. Reply
    Angry Bird
    July 8, 2012 at 4:04 am

    Mortgage companies make huge profits by re-financing.
    There are thousands of dollars to be made from closing costs. Great money for them.
    Lower payments – but more added to the loan since closing costs were added.

    7 months ago you should have gotten a whole lot better rate than 4.75%
    ^ a whole lot better.
    Something tells me that your credit may not be perfect or you have other debts.
    I would work on this first. Honestly, sounds like you should work on your credit first.
    Do you have any negatives or high debt showing on your credit reports?

  2. Reply
    July 8, 2012 at 4:19 am

    You should be careful in any refinance that you would want to do. These companies are in business to make money. One of these money making resources is in the refinance of mortgages.

    Even though the cost to refinance is not cash out of pocket, your refinance points and fees are rolled into the mortgage loan. Therefore if your mortgage loan to purchase your home is $ 100,000 and the fees to finance or refinance the house is $ 5,000, then your mortgage become $ 105,000. Refinancing the property once again would raise cost of refinancing by approximately the same. Therefore your refinance would cost an additional $ 5,000, so now your refinance is $ 110,000.

    You have to make sure you would be able to recoup the amount of your refinance over a certain amount of time. You would be able to calculate this by taking your current to find out how much you are saving and the time it take you to save the $ 5,000 cost of the mortgage loan refinance.

    From one combat veteran to another veteran thanks for serving.

    I hope this has been of some benefit to you, good luck.

    “FIGHT ON”

  3. Reply
    July 8, 2012 at 4:59 am

    I just closed on a streamlined refi, got a 2.75 on a 5/1 ARM. Since it had only been 7 months, my advice would be to refi ONLY if you would be comfortable making the same payment you are making now. If you refi and get the lower rate and continue making your current payments then you would reduce your principle that much faster since any additional monies over minimum goes to the principle. Otherwise you really won’t save anything. I would ask about the ARM, depending on the cap, you may be able to reduce the principle enough that the adjustment won’t matter.

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