FirstIB Mortgage Refinance Review

My mortgage refinance with First Internet Bank of Indiana ("First IB") is done. The new loan paid off the old loan. All done.

I thought I would update the progress as it moved along but it went so uneventful there wasn’t much to update. Here’s the timeline:

Day Activity
1 Submitted application online. Didn’t get an instant approval. It said an agent had to review it.
2 Contacted by a loan officer. Received disclosure.
3 Faxed W-2, paystubs, bank statement, etc. Got the OK to lock, but rate/fees went above my target. Decided to wait.
9 Rate/fees hit target. Locked rate.
10 Received updated GFE and rate lock agreement.
16 Scheduled appraisal.
20 Appraisal done.
22 Received appraisal report by email.
30 Underwriting approved. Picked date for closing.
36 Signed closing documents.
43 Old loan paid off.

If I count the days between when I locked the rate and when I signed the closing documents, it was only 27 days. That’s considered fast these days. It was pretty much a standard process. There wasn’t any glitch.

First Internet Bank delivered what it promised. The final cost was $15 less than what was originally quoted. I received good service from my loan officer. When I refinance again, First IB would be my first choice.

First IB can do better if it uses a better settlement service company. In my previous refinance with National Mortgage Alliance (NMA), NMA’s settlement service vendor LSI managed to a zero-day interest overlap: the old loan was paid off on the same day the new loan was funded. First IB’s settlement service company took two days to pay off my old loan. Those two days cost me money.

It’s still within the usual performance standard, but once you know somebody else can do better, you hope everybody performs to the higher standard. For the amount I was able to save by going with First IB versus going with NMA, I’m not complaining.

All together, I spent about $200 on this refinance. The $200 pays for:

  • closing cost not completely covered by a lender credit from First IB
  • payoff statement and lien release fees charged by the previous lender
  • 2 days of interest overlap

That $200 saves me over $1,000 in mortgage interest every year. It’s money well spent. However, if I had waited until now, the refi would cost even less because rates have come down slightly. Patience pays in many cases.

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Comments

  1. mikep says

    I believe you are allowed to choose your own title company. What about going with firstib and telling them you’re going to use LSI for the title services? Or maybe ENTITLE DIRECT is another one I’ve heard from the mortgage professor. Whenever I’ve tried this the lender tells me I’d need a longer lock since it takes “longer” to work with a different title company, but I think this is just an excuse to get you to use their title co.

  2. TFB says

    mikep – LSI is a wholesale settlement service company. I don’t think it will take business directly from a borrower. I got a quote from Entitle Direct last time. For my loan, Entitle Direct’s fee wasn’t any less than what NMA and FirstIB charged for using their preferred settlement service vendor. I also have no guarantee that Entitle Direct will pay off the old loan on the same day and give me a zero-day overlap. The lender has streamlined their computer system with their preferred vendors. I believe them when they say it will take longer and maybe cost them more in manpower because it’s more manual work.

  3. indexfundfan says

    TFB:

    FistIB’s rates are very tempting.

    I did my last refinance with a broker in August. She told me that I need to make four payments before the file can be re-submitted to Fannie Mae again.

    Do you know if there is there any truth in it?

    But I do think she will lose (part / all?) of the commission she earned if I refinanced within four months.

    Did FirstIB place any restriction on when you can refinance again?

  4. TFB says

    indexfundfan – I don’t know the answer but I don’t think there is any truth to it. Your broker don’t want to do it for you now because she would lose the fees she received last time, but it should be fine if you use a different bank or broker as originator. Call First IB to find out.

  5. Felpe says

    I was just looking into refinancing my condo and FirstIB bank came up on some forums I was reading. Their rates look great and thanks to your review, I may go that route. I do have some questions though.

    1. Did they charge in upfront charges, such as lock fee, application fee, appraisal fees? I really want to do a no cost loan and have no out of pocket costs.

    2. Were they responsive via email or phone and were readily available to give any updates?

    3. Did they honor the rate given and was the rate you locked the same as stated on their site? No bait/switch?

    4. Any issues you encountered that you did not mention in your post?

    5. Was your credit score excellent to receive the advertised rate?

    Thank you!
    Felipe

  6. TFB says

    @Felpe – They asked me for a credit card for the appraisal fee when I locked the rate. There was no lock fee, credit check fee, application fee, or any other fee before I locked. With the rate I chose, I got back the out-of-pocket appraisal fee at closing from the lender credit.

    They were responsive via email and phone when I had questions but don’t expect them to send you updates every day unprompted until there’s a next step. Everybody is busy these days. I let them do their job.

    They delivered what they promised. The rate and fees I locked were better than what showed on their website at that time. The final cost was slightly less than what I locked. No bait and switch.

    No issues from the bank. When the appraisal company didn’t call me two days after they ordered the appraisal, I emailed the loan officer. Then I got a call from an appraiser within an hour. I assume the loan officer got in touch with the appraisal company as a result of my email.

    Yes my credit scores were excellent.

  7. David says

    Based off of your reviews, I also went with FirstIB. At the time they seem to have the lowest rate, and I was able to lock when they were near the bottom. I’ll be paying $1000 closing costs for a 4.25 rate.

    However I have been quite unimpressed with their customer service. Several e-mails went unanswered for many days… in fact more than half. These were basic questions that I needed to know before I locked that would have taken 15 seconds to respond to. When I was ready to lock I couldn’t get a hold of anybody! My credit report came back without the score (she apologized). She forgot to send me a document she needed signed. One document she sent didn’t make sense…it said you you had to settle within 35 days of locking, and on the next line it said you had to give 35 days locking notice before you could settle. I asked her if it meant I had to settle exactly on the 35th day. She sounded confused for a while, told me I didn’t understand it, and then finally told me that she’s mailed this document thousands of times and I’m the first person to read it and say that (and she agreed with me). She patronizingly complimented me on my good reading skills, but I find It’s unsettling that I’m finding mistakes in their documents.

    Ultimately this is annoying, but I mostly care about the low rate and I’ll deal with the bad customer service. I just hope this woman doesn’t mess up my loan with all the other problems I’ve had. I’m hoping all the documents I faxed her are OK, but she didn’t write me to tell me if my documents were in order (she had said she would tell me the next day and it’s been 8 days) and she didn’t respond to my e-mail follow up on it, so who knows? Oh, and it’s very difficult to reach her on the phone too.

    I think I’m happy they will be selling my loan…

  8. sg says

    thanks for your review of FIB; it gave me the confidence to go with them and just last friday I closed on a 15 year refi at 3.75; everything went very smooth and they were very prompt with answering my emails and phone calls. The best thing is that closing cost was only about $200.

    I had no idea that interest rates had come down so low.

    sg

  9. David says

    18 days later, and more of the same from FirstIB. My worst customer service experience ever. I guess it depends on who you get to work on your loan. I think they have 5 or 6 agents, so you can roll the dice and hope you don’t get mine! It’s not like I’m pestering her with irrelevant questions… she asked me what date I want to close…I response the next day, and 2 weeks later (and 3 days before the possible date) there is no response to any e-mail or call on the topic! She apologized on the phone and said they upgraded their security so she missed my e-mails. That doesn’t explain why she doesn’t answer my voicemails either! Everytime I call she always says “I was just about to call you.” Yeah right!!

  10. Beans says

    I am going with FirstIB as well. Although, the service I received is not first rate. It is too bad that I should have looked for Mark or Gary. The lady I had is not clueless but less than prompt in many occasions. I will be glad when I close.

  11. David says

    Haha, I bet I know which woman you got.

    Mine informed me yesterday that the closing date I gave for next week was booked. I wonder if it was booked when I selected the date 2.5 weeks ago, or it was booked when she waited until yesterday to try and get it.

    I get the feeling she is disorganized. A missing fax showed up weeks later. Nothing happens unless I call to make it happen. I’m a mathematical person, and I bet if you graphed when she took steps to close my loan, you’d find that almost everything happened immediately after a successful phone call, and almost nothing happened the rest of the time.

  12. TFB says

    David and Beans – Why not just name the loan officers? There are only two female officers in the list. That way others will know who’s good and who’s not as good. I think First IB as a company is still a good lender. The rates and fees are among the lowest one can find. They update the rates and fully disclosed fees daily on the Internet. No bait and switch. As far as customer service goes, if one loan officer doesn’t do a good job, just avoid her. We don’t have to throw the company under the bus just because of one loan officer.

  13. David says

    Mine is Deb Allaben. I am supposed to be closing for early next week, but still don’t have a date. Thursday she e-mailed me (and called me!) saying Monday was booked. She said she would e-mail me again on Friday with an update. Well it’s Saturday and nothing.

  14. Alskar says

    Thanks for recommending First Internet Bank of Indiana. I closed on my new loan on 12/8. I applied on 10/18, locked on 11/4. The appraisal took some time to arrange (the appraiser was terribly busy), but everything went very smoothly. I didn’t have any of the communication issues that others are reporting. My loan officer was Melanie Smith. I highly recommend Melanie. I’m working 60-80 hour weeks so I didn’t really have time to waste on inefficient communication. Melanie responded to email promptly. I only spoke to her on the phone once…to give her my credit card information for the appraisal.

    In the end I paid nothing, zip, zero, nada for my new 15 year, fixed, 3.75% mortgage. By that I mean that my loan amount didn’t go up and I didn’t pay any fees (no out of pocket expenses). That’s incredible in my view.

    Disbursement on my loan is on 12/13. I expect that there will be at least one day of interest overlap.

    I highly recommend First Internet Bank of Indiana!

  15. Alskar says

    A few days ago I received notification from First Internet Bank of Indiana that my mortgage was sold to GMAC Mortgage. Don’t know if First IB sells all of their mortgages to GMAC Mortgage, but that’s where might ended up.

  16. David says

    My refinance is complete. 2 days before my closing she told me I would be getting a check back at closing for several hundred dollars. That surprised me. Then less than 24 hours before closing she told me I needed a cashiers check for over 1000 dollars and was unclear about who it needed to be made out to.
    Within a week of my closing my loan was sold to Chase. I am fine with that.

  17. TFB says

    @Alskar – No, they don’t sell all of them to GMAC. Who gets it depends on who was offering the best wholesale rate at the time you locked.

  18. Alskar says

    @TFB: That’s what I thought, but the loan officer said that she had no idea to whom my loan would be sold. This was after closing which was way after locking.

    Anyway, I’m very pleased with First IB. Thanks for recommending them!

  19. Alskar says

    I received a letter today informing me that GMAC Mortgage sold my loan to Fannie Mae on January 3rd. My loan will now be serviced by “Ally Bank” not GMAC Mortgage, but the loan number and the address where the check is to be sent stayed the same.

    The letter specifically said that the transfer of my loan to Fannie Mae will not be publicly recorded.

    This is a new one on me, but since it really doesn’t affect me it’s no big deal.

  20. Beans says

    I am glad that many of you had positive experience. Mine wasn’t at all positive. There were many things that didn’t go smoothly to retell. Here are some that stuck to my mind:
    - Very slow in responding emails & phone calls. I am talking about 3-4 days to return emails. Half of the time, I don’t get responses or got some lame excuses
    - It took some time to get the rate lock so I miss out some good lender credit. It was because …. drum roll, slow response from her.
    - The payoff statement weren’t right, I asked her to reorder. It took 3 tries for her to order the right one. I wanted the unpaid balance after deducting escrow amount. My last couple of refi, this was done automatically. (I know if I don’t do that, the escrow amount will be returned to me eventually, well, I don’t want to sit around waiting for ten thousand to show up eventually). She first told me that it can’t be done, I called my old mortgage company, they told me that it can be done (I KNOW it can be done), call her back, etc … it still took 3 tries. In the mean time, she blamed someone else for the screw up.
    - The day of closing, I still had to leave voicemail for her to let me know the amount of cashier check I have to bring.
    - I told her that in my state, I don’t pay transfer tax for refi, so make sure that it was taken off. Nope, wasn’t done either.
    - I had to pay more that what I expected at closing because I didn’t get as big of lender credit as originally promised. Nobody explained to me that lender credit depends on the loan amount, so if you borrow less that you originally planned then your lender credit smaller. I don’t know this is her fault or FirstIB’s fault for not disclosing that
    I was so glad that my loan sold right after it closes because I don’t have any more patience dealing with my loan officer.

    The rate offered by FirstIB was hard to beat, just make sure that you don’t get the same loan officer as I did.

  21. DK says

    I’m glad i found this thread. I have just initiated my loan communication with FirstIB. My loan officer is Melanie and she seemed to be knowledgeable and prompt. I’ll report how it goes from here on.
    I was initially a little apprehensive with using FirstIB since they are internet only but this thread helped me take the dive.

  22. amzsales says

    When you talk about no-fees refinance does that mean that firstib covers all the associated costs including the appraisal?

  23. Alskar says

    Yes, no-cost and no-fees means precisely that. My loan balance didn’t go up and I incurring no out-of-pocket fees. Actually I got $305 back at closing.

    I had to pay $425 for the appraisal up-front, but that money was refunded to me at closing.

  24. patty says

    I just finished a refi with first Int. bank of IND. and had a great experience with mike watson. everything was done on time and he was very professional and responsive to all my requests, include some very last minute ones. he kept me in the loop at all the stages. All told, got a very good deal and the whole thing was very professionally done. Highly recommend.

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