Being?immersed?in the personal finance blog community?over?the last several months, I?couldn’t?help being exposed to the thought that now might be a good time to refinance my mortgage. It’s something I have studiously avoided in the past. It seems that as hard as I try, I can never get a true “no closing cost” loan and end up increasing the amount I owe on my mortgage by a few thousand dollars, which irks me to no end. I like to watch my debt balance go down, not up! ?The interest rates, along with the fact that we only plan on staying in this home for another five years, were a compelling enough?reason?for me to at least take a hard look at what refinance mortgage options are?available in the market today.
What I Wanted in a New Mortgage
There were several criteria I was looking for to refinance. I’ve already mentioned that I was not willing to pay closing costs, so not having closing costs was the first one. The next one was that it had to be a five year adjustable rate with a fairly aggressive rate. I began my search with a call to quicken loans. All of the advertising I had heard for them on the radio led to a “why not” moment.
That was a complete bust. The agent I spoke to immediately made a “professional?assessment” of my situation and pushed me towards a 30 year fixed rate mortgage. I explained to him the objective of getting a refinance was to LOWER MY MONTHLY PAYMENT and NOT STAYING IN THIS HOME MORE THAN FIVE YEARS. I had to tell him this several times. After the third time that I asked him to explain why a 30 year fixed was better than a 5 year variable, ?I lost my patience and told him I would call them back after doing more research. That was my polite way of telling him to “piss off”. My guess is they get a nice commission for a longer term fixed rate mortgage but that’s just speculation on my part.
My next stop was the trustworthy internet :O. ?I?Googled the term “refinance”, selected the first two sites that came up, entered my information and?waited?for the calls to start coming in. You?re probably wondering why I went that route. I’m fed up with the traditional mortgage companies I’ve used in the past and my experiences with local banks. So going “greenfield” would be an interesting and probably amusing venture. The calls started coming in, I had 5 calls within the next half hour. One of them was intriguing. I ended up?spending?about 15 minutes with the gentleman, Jason, ?from the Roundpoint Mortgage Company.
The Refinance process
In those 15 minutes I gave him a quick?description?of what I was looking for and some basic information about my financial situation. The rate he came back with was aggressive (2.75%), it was for a five year adjustable and there were no closing costs associated with it. Jackpot! We followed up with a call later that afternoon so I could formally apply for the mortgage. That process?didn’t?take more than about a half hour on the phone. What did take a few hours was scanning all of the supportive?information?they needed for the application and uploading it to their secure website. That was a bit annoying but not something to?judge?Roundpoint by since you would have to do this for any other mortgage application.
As the mortgage refinance application process went through its cycles we hit the first stumbling block, my appraisal. It appears that appraisers have become a bit more cautious in how they appraise homes. My home has a finished and heated bonus room that doubles as a bedroom. That room has about 400 square feet of usable space. In the past, appraisers have always counted it the final appraisal of the house. Not today, our county does not have that finished space listed as part of the heated living space, so the?appraiser?refused to include it in his valuation. This bought the Loan to Value ratio up and kicked me into a higher risk category.
We had two options at that point. We could go with the higher LTV and deal with a higher interest rate (3.0%) or try to get another appraiser in. Jason at Roundpoint went to the mat on this one. His first stop was the company that arranged for the appraisal. He went a few rounds with them and came back with unwanted news, what the appraiser did was the new norm in the appraisal process. Getting another appraiser in would be costly and in all?likelihood, end up with the same results. I opted to go with the slightly higher interest rate and Jason worked in a credit at close to help make up for the aggravation.
The loan progressed through its courses and we finally got close to closing. By that time about 8 weeks had passed from the time I applied for the loan. ?I paid off one credit card soon after applying and as a result, my credit score bumped up by about 15 points. I called Jason and let him know this to see if that could bring the rate down. Before doing anything he was careful to ask me if I had made any credit applications, or started any new lines of credit (In case you?re wondering, OF COURSE NOT). He didn’t want to pull a new credit score and have it go down as that would negatively affect the interest rate on the new mortgage. I told him that I was clean. He pulled up my new score and based on where it was sitting, was able to reduce my interest rate down to 2.75%! So we were back to the original number even with the bad LTV!
Closing the mortgage
I closed on this refinance early last week and the close was uneventful. As with any mortgages, closing involved what appeared to be several thousand documents and a signaturefest that left me with writers cramps. (Not really, but it should have considering how many times I signed a document).
There were no points on this loan, so it was a true “no closing cost” loan. My costs were limited to two items, the appraisal and the title insurance. Both of these are items that you would have to pay with any mortgage, so I don’t have a problem with that. I also had to fund the escrow account with enough money to cover any upcoming taxes or homeowners insurance renewal. These costs will end up being a wash since the amount I paid towards them is about the same as is in my old escrow account, which should be refunded to me shortly. ?Overall I knocked my mortgage payment down by a bit more than $200 a month.
Would I?recommend?Roundpoint to anyone? Absolutely!?I’ve?had many mortgages and refinances over the years, this experience stands out as one of the easiest and flawless refinances I have the pleasure of undertaking. More to the point, Jason at Roundpoint was on top of the entire process, jumped in and cleared the path, and was always available to answer any questions that came up along the way.
In case you’re wondering, I have no affiliation with Roundpoint, there aren’t any referral fees. I’m writing about them because of the exceptional service I received from them. If anyone reading this is considering a mortgage refinance, I would suggest that a call to Roundpoint should be on your list. If anyone is interested in talking to Jason directly, email me and I?ll respond with his contact information.
Do you have a mortgage refinance experience you would like to share with us?
Image Credit:?Svilen
Wise Dollar
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Sounds like a sweet deal Jose! Congrats on getting it knocked out. 2.75% is great…
Thanks Jacob! I’m really pleased with it 😀
Sounds like you won that one Jose. I was looking at a refi for a little bit, but then we decided that we wanted to move within a year and it wouldn’t have been worth it to me. Plus, I need the extra year to get the home prices back up in order to make it worth while. Thanks for the recommendation though.
Yeah, if you’re moving within a year a refi would be crazy! The home prices around here are getting beat down, which really sucks since they never took off prior to the bust like they did everywhere else!
Nice job Jose. We were debating on refinancing our mortgage but most companies said they were unable to do it because of new federal restrictions. Basically we had to either be at the end of our ARM or save a certain percentage on our monthly payment each month. I gave up on that point and the fact that we still have 3 years left on our ARM. Hopefully in that time frame the housing market will begin to get better.
Thanks, I’m really pleased with the refi. Hopefully when we’re ready to moce (in five years or so) there will have been a nice bounce in house prices! 🙂
Great job, Jose, and thanks for sharing! It’s always nice to have a list of good companies on hand should the need for their services arise. Congrats on the great deal!
Thanks Laurie, I’m quite pleased with the loan and I’m glad it went through. It will help with freeing up some monthly cash for debt relief!
I love stories of good customer service when the norm seems to be terrible instead. Great job on the refinance. We refinanced early in 2012, and it was a terrible process, but it did lower our rate quite a bit.
Thanks Kim, most of my mortgage and refinance experiences have been less than optimal, I was extremely pleased with this one and the level of service I got!
Looks like you got a great deal Jose. I’ll honestly have to say that I wouldn’t want to do business with any of the big banks anymore. The fees are horrendous and the service is worse. From now on I’ll just stick with my local bank. The closing cost are far less, the rates are better, and I can talk to someone face to face if I prefer.
I can’t stand the big banks, the fees they charge are outrageous, even for the most basic of services. I’m glad I went with Roundpoint and am pleased with the outcome. Thanks for stopping by.
Great story. I HATE talking to phone salespeople and always find a reliable person I can meet face-to-face, so it’d be hard for me to do what you did and go online.
On your appraisal, you’re right on…it’s not like “the old days.” A friend of mine sat on his porch with a six pack and waited for the appraiser, who helped him finish his beer before taking a look at what the property was worth. Needless to say, his house’s value was well over the number he was looking for.
I think I would have needed a case of beer for the hard a$$ that gave me my appraisal :). I now need to take that appraisal to the county and raise cain with them to lower my valuation!
Wow, Jose it sounds like Jason took care of you, glad to see. We are trying to refi, but I want a 15 year at under 3%. The local bank says they can guarantee to 5 years at 2.75% but it would be likely sold to Wells Fargo who may change the rate in 5 years. SO I would like 15 years fixed at under 3, still holding out, maybe I need to call Jason.
I think it would be worth a call for you. I’ll email you his name and contact information. Let me know if you do call and if they can help you out.
[…] Wise Dollar wrote about his most recent mortgage refinance with Roundpoint Mortgage. […]
It’s interesting reading this now, quite a while after it was posted. We closed on a mortgage for our new home with Roundpoint Mortgage in August 2013. We did quite a bit of looking around, and they were the mortgage company with the lowest rate – along with zero closing costs. We ended up getting a 30 year mortgage at a 3.75% rate. Thankfully we got in at a sub 4% rate right around the time rates were about to go up.
I also got quotes from a bunch of different companies including Quicken, CapWest and some others. Roundpoint was the best from the start as far as rates and costs.
The process was another matter. I’ve gotten mortgages before but never had to provide as much documentation as I did with Roundpoint. I think that’s probably pretty standard nowadays – I think I was just used to the old process when we bought our previous homes with little documentation.
We did have some hiccups as well when our documentation was lost by Roundpoint and we had to resend, and others when we had some snafus for scheduling the closing. Overall, however, we were happy with the experience. We got the rate and costs that we were promised and in the end a mortgage that was lower than anywhere else we had checked.