shalab Posted September 13, 2011 Share Posted September 13, 2011 Hoe many here refinanced? I did this week as the 10 year bonds nose dived, I was already on a low rate but that low rate got lower. I expect the banks to get tail wind from refinancing this quarter and next... Link to comment Share on other sites More sharing options...
alpha231616967560 Posted September 13, 2011 Share Posted September 13, 2011 I have a mortgage with Wells Fargo, and they have refinanced for me (at their suggestion) and for some reason they picked up 100% of the costs *twice* in the past four years. I believe that my current rate is 4.125. I am hoping that they'll do it again. Link to comment Share on other sites More sharing options...
beerbaron Posted September 13, 2011 Share Posted September 13, 2011 I refinanced last week. 3.89% for 5Y, Canada is so expensive compared with US rates >:( I almost tough of getting a US loan and hedging the currency, I think it would come cheaper then using a Canadian bank. BeerBaron Link to comment Share on other sites More sharing options...
biaggio Posted September 13, 2011 Share Posted September 13, 2011 I have a mortgage with Wells Fargo, and they have refinanced for me (at their suggestion) and for some reason they picked up 100% of the costs *twice* in the past four years. I believe that my current rate is 4.125. I am hoping that they'll do it again. do you ever worry about why they would do that? Just good business practice of taking good care of your customer? Maybe there is some sort of incentive for your bank rep? How does that compare to the variable rate? Link to comment Share on other sites More sharing options...
zarley Posted September 13, 2011 Share Posted September 13, 2011 I've refinanced twice in the last 4 years. I went from 6.0% to 5.25% to 4.25%. Took more than $500 per month off my mortgage payments in the process. I've simply added most of that back as an extra payment each month and will wind up paying off the loan well in advance. Just looked at current rates and could probably get down to 3.75% if I pay a point to buy down the rate; but i don't think it's worth it at this point. Link to comment Share on other sites More sharing options...
alpha231616967560 Posted September 13, 2011 Share Posted September 13, 2011 do you ever worry about why they would do that? Just good business practice of taking good care of your customer? Maybe there is some sort of incentive for your bank rep? How does that compare to the variable rate? I have certainly wondered, especially being a WFC shareholder. They actually just mailed me a letter one day saying that they wanted to refinance the property at no cost to me. No bank rep. I can only assume that it's a customer retention strategy, though twice in 4 years seemed excessive to me (not that I would turn them down...). Their ARM is currently 2.5%. Link to comment Share on other sites More sharing options...
Tim Eriksen Posted September 13, 2011 Share Posted September 13, 2011 It would be strange for WFC to offer to refinance if they held the loan in their own portfolio. Why would WFC lower its interest income? Now if WFC had sold off the loan and currently just serviced it, then it would be very wise for them to offer the refi since they can resell the new loan for a profit. Link to comment Share on other sites More sharing options...
alpha231616967560 Posted September 13, 2011 Share Posted September 13, 2011 It would be strange for WFC to offer to refinance if they held the loan in their own portfolio. Why would WFC lower its interest income? Now if WFC had sold off the loan and currently just serviced it, then it would be very wise for them to offer the refi since they can resell the new loan for a profit. I thought so too. But they still hold the loan, and as I said they offered it twice. Go figure. I do have good credit, and maybe it was a reaction to the sub-prime mess. So now the question is how to get them to do it again ::) Link to comment Share on other sites More sharing options...
seshnath Posted September 14, 2011 Share Posted September 14, 2011 It would be strange for WFC to offer to refinance if they held the loan in their own portfolio. Why would WFC lower its interest income? Now if WFC had sold off the loan and currently just serviced it, then it would be very wise for them to offer the refi since they can resell the new loan for a profit. May be, this is part of the ethos that Buffett is talking about. Makes sense to me, would you rather your customer re-fi with you or with someone else and have to deploy the funds with an unknown risk or not deploy the funds at all? Now, they have a happy paying customer and portfolio is intact with no prepayment. Link to comment Share on other sites More sharing options...
rranjan Posted September 14, 2011 Share Posted September 14, 2011 I had very different experience with Wells though. I was looking for new loan roughly 15 months ago. I got much higher quote from Wells than some smaller bank. I took loan from smaller bank and then they sold the loan to Wells. Now I wanted to see if refinance rates will be lower by decent margin. I called same smaller bank again. They offered me rate one point lower. I called Wells, they offered me rate not much lower than what I have right now. I explained to them that smaller bank is offering lower rate and last time wells ended up buying the loan from them so why can't they at least match it. There is good chance that they will sell the loan to Wells again. I got explanation about having volume discount etc but if they could match then it will have better returns than buying from smaller bank because smaller bank is going to take their margin. I don't have any idea about Wells general practice . Just sharing my personal experience. Link to comment Share on other sites More sharing options...
bookie71 Posted September 14, 2011 Share Posted September 14, 2011 Are you sure that Wells owns the loan or are they simply servicing it for an investor? There is a lot of earnings for banks by simply acting as a collection agency for investors (state retirement funds, etc) Link to comment Share on other sites More sharing options...
rranjan Posted September 14, 2011 Share Posted September 14, 2011 I think they own the loan but I might be wrong. Link to comment Share on other sites More sharing options...
biaggio Posted September 14, 2011 Share Posted September 14, 2011 I had very different experience with Wells though. I was looking for new loan roughly 15 months ago. I got much higher quote from Wells than some smaller bank. I took loan from smaller bank and then they sold the loan to Wells. Now I wanted to see if refinance rates will be lower by decent margin. I called same smaller bank again. They offered me rate one point lower. I called Wells, they offered me rate not much lower than what I have right now. I explained to them that smaller bank is offering lower rate and last time wells ended up buying the loan from them so why can't they at least match it. There is good chance that they will sell the loan to Wells again. I got explanation about having volume discount etc but if they could match then it will have better returns than buying from smaller bank because smaller bank is going to take their margin. I don't have any idea about Wells general practice . Just sharing my personal experience. Geez, I dont get it. rranjan, maybe you should talk to alph23's bank rep? This does not sound good for shareholders of WFC Link to comment Share on other sites More sharing options...
seshnath Posted September 15, 2011 Share Posted September 15, 2011 I think they own the loan but I might be wrong. If yours is a conforming mortgage, it might very well be packaged with Fannie or Freddie and the small bank may be using Wells to service it. I believe you can check it at Fannie/Freddie websites with your home address. (I checked mine a couple of years ago.) It will not give out details - it will tell you if the loan is with them or not. Link to comment Share on other sites More sharing options...
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now