I took new loan (7/1 ARM) to buy house 7 months back, now I’m getting offer from same lender that I can refinance to reduce small interest (0.375) and at zero closing. I am suspecting May be there is a catch, is it good idea to refinance to save small interest? and are there any advantages with first home loan. Update: existing and new loan are same terms 30 yr 7/1 ARM and interest reduces from 3.75 to 3.375.
I do have the same case. I am getting 3.75 % for 30 year fixed. My current rate is 4.25 with 7/1 arm.
This question is incomplete. What rate do you have on 7/1 ARM. And what rate are you being offered for the refi. Is it also 7/1? Also, you will have some recording costs that may add up to several hundred dollars (check your local government) that is not often covered by that $0 closing.
Also don’t look at just the interest rate. What’s your APR ?
0 closing means you are paying a lot, it's like when Verizon gives you a "free" phone
can you elaborate?
Lender's get paid to sell loans; they wouldn't sell you a loan out of the goodness of their heart. The fee is baked in somewhere so make sure the total loan is actually a reduction for you. I'd be surprised if it were given rates are rising but could be!
Zero due at closing usually just means that the costs are rolled into the loan, not that there are no costs. Depending on loan amount and costs, it may be worthwhile or it may not. Have them provide you with an estimate of the costs.
do you mind disclosing the lender name?
Re-finance also means that you have lost the interest that you have already paid. is it even worth considering?
I assume you meant reset of the tenure. Yes, you will pay more months of mortgage, but I guess savings will be more than additional payouts and also I expect to prepay when savings increase, so tenure is not that relevant.
I heard you maybe able to get 3.25%