The Fed announced that it’s prepared to provide additional easing if needed. The bond market responded positively, which brought down the mortgage rate, again. If you are doing a mortgage refinance, and you already locked your rate and fees, what do you do if you see the rate and fees drop after you lock? There […]
How Much Money Does a Bank or Broker Make From a Mortgage Refinance?
Have you wondered how much money a bank or a mortgage broker makes when you do a mortgage refinance with them? By law, a mortgage broker must disclose their compensation but you often don’t see it until you get the final closing statement (“HUD-1”). In a post last year, Mortgage Broker vs Mortgage Lender, I […]
Mortgage Refinance: When to Lock?
I showed this chart in my previous post about comparing the total closing cost from different lenders. In addition to the cost difference across lenders, it also shows the total closing costs go up and down quite significantly from one day to another. Even with the least expensive lender, choosing when you lock your rate […]
Mortgage Refinance: Tradeoff Between Rate and Closing Cost
Say you chose a lender for your mortgage refinance. You still have to decide whether you should go for a lower rate with a higher closing cost or a higher rate but with no or minimal closing cost. You can also buy down the rate by paying points. Making the perfect decision requires a crystal […]
Mortgage Refinance: Which Lender?
As I mentioned last week, I’m doing a mortgage refinance with a lender I haven’t used before: First Internet Bank of Indiana ("First IB"). My previous two refi’s were done through National Mortgage Alliance (NMA). NMA did the jobs well both times. My last one finished in 2 weeks from application to closing. So why […]
Mortgage Refinance: Is Your Lender Legit?
How to research whether the bank, credit union, mortgage company, or mortgage broker is legit.
Hopping On Another Refi Train
I thought the last train for mortgage refinance left in March but the trains keep coming. Rates have gone lower and lower. I’m doing another refinance to lower my rate to 3.75% for a 15-year fixed rate loan. This time, instead of going to my twice favorite National Mortgage Alliance (NMA), I’m using a different […]
Last Train for Mortgage Refinance
On March 16, the Fed announced it would stop buying mortgage-backed securities effective March 31. Instead of going up, the mortgage rates reached a new low on the next day. As a result, I’m doing another no-cost refinance to lower my rate by a quarter of a percentage point. I think this really will be […]
Mortgage Refinance and Option Pricing
Being a blogger with a contact form, I often receive PR outreach messages. They want me to write about what they are trying to promote. I ignore most of those. Once in a while, I get something worth reading. Andrew Kalotay Associates is a fixed income analytics and debt management advisory services company in New […]
Foreclosed Homeowners’ Rate of Return
Via a post on the Bogleheads forum, I read this piece of news from the WSJ Developments blog: Study Finds Underwater Borrowers Drowned Themselves with Refinancings From that WSJ blog post, I read this research paper: LaCour-Little, Michael, Eric Rosenblatt, and Vincent Yao, 2009. Follow the Money: A Close Look at Recent Southern California Foreclosures […]
Does a Mortgage Escrow Account Pay Interest?
Escrow accounts are required to pay interest in some states. The mandated minimum interest rate can be higher than the interest rate you can get in the best savings account.
Mortgage Ecosystem: Direct Lender
My mortgage refinance was completed on June 3. I made my first payment to my new lender today. I did the refi through National Mortgage Alliance (NMA), which is a division of a bank Georgia Banking Company (GBC). The name on my loan paperwork was “Georgia Banking Company dba National Mortgage Alliance.” Officially, I borrowed […]