DONT Payoff your Mortgage Club

[Dicey]

Hey I was wondering.... can anyone tell me?  Do details matter or not?

Hey all, meet dragoncar, the funniest creature on this forum. He's also very smart and breathes FIRE. Don't fuck with him. As long as you're nice to him, no one will get hurt. Maybe.

[Fomerly known as something]

What matters with mortgages is whether you are using it as agreed on the note. It doesn’t matter if you split who holds each loan. If you aren’t living there r have rented it out, that could be a problem. Check first, or risk penalties.

Thank you for your feedback and opinions...this was more complicated than I thought, unfortunately :(
What would YOU do if this was your situation?  Now, I think I just got confused.  Refinance but maybe unable to rent it out in the future or keep original mortgage and can rent it out since notes allow after 3 years...
You're right, we're all in this together and trying to help and learn from one another and I really appreciated your time and comment.

thank you.
[/quote]

There are several questions I’d ask in addition to refinance questions.  As I don’t know if you should rent out your house.

1.  Do I want to be a landlord and why?
2.  Do I want to be a hands on landlord, if not do the numbers work if I hire a property manager.
3.  Do the numbers work as a rental on your current.  I don’t mean can I rent it for the PITI, but also factoring in vacancies and Maintence.  (Does it meet the 1% rule, property rents for at least 1% of the purchase price ie a 100k house rents for $1,000 a month).
4.  Also you mentioned DR, you know he would be yelling at you for considering that you are considering buying a second home with a mortgage while still in other debt right?  Especially when you don’t have a 3-6 month emergency fund.  Where are you getting you down payment let alone affording a new roof on your “new rental”

[Dicey]

4.  Also you mentioned DR, you know he would be yelling at you for considering that you are considering buying a second home with a mortgage while still in other debt right? 

Fortunately, this is the Don't Pay Off Your Mortgage thread on the Mister Money Mustache Forum. We do things to optimize the path to FIRE. Here, we tend to yell at Dave Ramsey for the crappy investment advice he peddles.

[CarnivoreforLife]

What matters with mortgages is whether you are using it as agreed on the note. It doesn’t matter if you split who holds each loan. If you aren’t living there r have rented it out, that could be a problem. Check first, or risk penalties.

Thank you for your feedback and opinions...this was more complicated than I thought, unfortunately :(
What would YOU do if this was your situation?  Now, I think I just got confused.  Refinance but maybe unable to rent it out in the future or keep original mortgage and can rent it out since notes allow after 3 years...
You're right, we're all in this together and trying to help and learn from one another and I really appreciated your time and comment.

thank you.

There are several questions I’d ask in addition to refinance questions.  As I don’t know if you should rent out your house.

1.  Do I want to be a landlord and why?
2.  Do I want to be a hands on landlord, if not do the numbers work if I hire a property manager.
3.  Do the numbers work as a rental on your current.  I don’t mean can I rent it for the PITI, but also factoring in vacancies and Maintence.  (Does it meet the 1% rule, property rents for at least 1% of the purchase price ie a 100k house rents for $1,000 a month).
4.  Also you mentioned DR, you know he would be yelling at you for considering that you are considering buying a second home with a mortgage while still in other debt right?  Especially when you don’t have a 3-6 month emergency fund.  Where are you getting you down payment let alone affording a new roof on your “new rental”
[/quote]

I appreciate your reply- to answer your question:

I always wanted to try. I Know the pros and cons and def will regret if I don’t take the risk. Basically, I’ll regret it if I don’t try something (one of those people :) ).
I don’t care about DR and this is the DON’T pay off your mortgage thread.
And I’m not sure how the assumption was made on me having no cash, emergency funds etc?...

Thanks

[Mako52]

9/17/20.......Just closed on a 2.625/30yr with Lenderfi.  If the escrow refund from Loan Depot (3.25/30) is what I expect, net out of pocket cost is $350.  Saves us $2900 in interest the first year alone and frees up future cash flow to diversify away from illiquid home equity.
 

[CarnivoreforLife]

9/17/20.......Just closed on a 2.625/30yr with Lenderfi.  If the escrow refund from Loan Depot (3.25/30) is what I expect, net out of pocket cost is $350.  Saves us $2900 in interest the first year alone and frees up future cash flow to diversify away from illiquid home equity.
 

Oh! How niceeee!
Congrats!

[nereo]

9/17/20.......Just closed on a 2.625/30yr with Lenderfi.  If the escrow refund from Loan Depot (3.25/30) is what I expect, net out of pocket cost is $350.  Saves us $2900 in interest the first year alone and frees up future cash flow to diversify away from illiquid home equity.
 

That's awesome.  Kudos to you!

[NotBadForADad]

9/17/20.......Just closed on a 2.625/30yr with Lenderfi.  If the escrow refund from Loan Depot (3.25/30) is what I expect, net out of pocket cost is $350.  Saves us $2900 in interest the first year alone and frees up future cash flow to diversify away from illiquid home equity.
 

How legitemate is this, I went to their site and they saying $1035/monthly, including insurance.

[couponvan]

9/17/20.......Just closed on a 2.625/30yr with Lenderfi.  If the escrow refund from Loan Depot (3.25/30) is what I expect, net out of pocket cost is $350.  Saves us $2900 in interest the first year alone and frees up future cash flow to diversify away from illiquid home equity.
 

How legitemate is this, I went to their site and they saying $1035/monthly, including insurance.

I'm not sure what you are asking here because the $1,035 monthly could mean anything.  We are using Loan Depot right now for a no cost 2.5% 30 year fixed refi (VA, excellent credit).  I've never used Lenderfi, but I have heard of it. Your rates are going to depend on your credit, loan amount, loan-to-value ratio, employment history, and income. The insurance inclusion payment amounts are usually just an estimate. Your own insurance and taxes will vary by location.

[talltexan]

I see some discussion above about Dave Ramsey and the baby-steps.

If you are reading this and committed to bringing order to your finances through the Dave Ramsey baby steps, please follow through at least to baby step #3 (full emergency fund). Bond yields will stay low for long enough for you to kill your non-mortgage debt.

Then come back to this thread. For planning your next ten years after you're out of debt, we think we're on to something.

[NotBadForADad]

I see some discussion above about Dave Ramsey and the baby-steps.

If you are reading this and committed to bringing order to your finances through the Dave Ramsey baby steps, please follow through at least to baby step #3 (full emergency fund). Bond yields will stay low for long enough for you to kill your non-mortgage debt.

Then come back to this thread. For planning your next ten years after you're out of debt, we think we're on to something.

Sounds good. I created a case study as well.

[Fomerly known as something]

What matters with mortgages is whether you are using it as agreed on the note. It doesn’t matter if you split who holds each loan. If you aren’t living there r have rented it out, that could be a problem. Check first, or risk penalties.

Thank you for your feedback and opinions...this was more complicated than I thought, unfortunately :(
What would YOU do if this was your situation?  Now, I think I just got confused.  Refinance but maybe unable to rent it out in the future or keep original mortgage and can rent it out since notes allow after 3 years...
You're right, we're all in this together and trying to help and learn from one another and I really appreciated your time and comment.

thank you.

There are several questions I’d ask in addition to refinance questions.  As I don’t know if you should rent out your house.

1.  Do I want to be a landlord and why?
2.  Do I want to be a hands on landlord, if not do the numbers work if I hire a property manager.
3.  Do the numbers work as a rental on your current.  I don’t mean can I rent it for the PITI, but also factoring in vacancies and Maintence.  (Does it meet the 1% rule, property rents for at least 1% of the purchase price ie a 100k house rents for $1,000 a month).
4.  Also you mentioned DR, you know he would be yelling at you for considering that you are considering buying a second home with a mortgage while still in other debt right?  Especially when you don’t have a 3-6 month emergency fund.  Where are you getting you down payment let alone affording a new roof on your “new rental”

I appreciate your reply- to answer your question:

I always wanted to try. I Know the pros and cons and def will regret if I don’t take the risk. Basically, I’ll regret it if I don’t try something (one of those people :) ).
I don’t care about DR and this is the DON’T pay off your mortgage thread.
And I’m not sure how the assumption was made on me having no cash, emergency funds etc?...

Thanks
[/quote]

Sorry on the DR confused your question with NotBadForADad.

[rpr]

Trying to join the refi bandwagon. I'm working with a local broker. Most of the common online discount mortgage brokers are not licensed and do not issue mortgages in my state limiting my options.

Current Loan: 22 years left, balance $230K, 30 year FRM @ 3.5%.

Quoted Rate: 30 year FRM at 2.625% with 0.4% points and a 60 day lock. Additional closing costs are about $6K which includes origination fee, appraisal, title insurance, settlement fee etc. These costs will be rolled over into the loan. Escrow for insurance and taxes are separate.

I checked Loan Depot and they offered a higher rate 2.99% with similar closing costs.

With this refi, if I continue making previous payments, I'd pay off the loan in 20.5 years. So this saves about 1.5 years of my current loan. (I do not intend to do this but providing this just for comparison).

Is this an OK rate? 

Lock it or wait? Thanks.

[talltexan]

ten-year treasury bills yielding 0.6% right now, not sure how low they can go. Will the 2.625% rate get you enough movement that you're happy?

[rpr]

ten-year treasury bills yielding 0.6% right now, not sure how low they can go. Will the 2.625% rate get you enough movement that you're happy?

Thanks. I did end up locking yesterday (30 day lock) for a 30 year FRM @ 2.5% with a small lender credit.