How do I know when to lock in my refi rate? Need help with my deal

Seeking Advice
1

I’m looking for advice on locking in a refi rate. I just got an offer from AmeriSave, but they said they can match other offers, so I’m still shopping around. I understand you can’t really time the market, but does this offer seem reasonable based on what you all are seeing lately?

I’m located in Bay City, MI, and I have an excellent credit score. My Loan to Value (LTV) ratio is 60%. Here’s the deal I’m looking at:

Loan Terms:
• Loan Amount: $210,000
• Interest Rate: 6.625% (fixed)
• Loan Term: 30 years
• Monthly Principal & Interest Payment: $1,344.65
• Total Monthly Payment (including taxes and insurance): $1,710

Closing Costs:
• Total Estimated Closing Costs: $9,578
• Origination Charges: $6,426
• Points (2.348% of loan amount): $4,931
• Lock Fee: $500
• Underwriting Fee: $995
• Services You Cannot Shop For: $746
• Appraisal Fee: $550
• Credit Report: $42
• Other fees: $154
• Services You Can Shop For: $1,205
• Title - Lender’s Title Insurance: $380
• Title - Settlement Services: $750
• Other fees: $75
• Taxes and Other Government Fees: $30
• Prepaids: $76
• Prepaid Interest: $76
• Initial Escrow Payment at Closing: $1,095
• Homeowner’s Insurance: $261
• Property Taxes: $834

Estimated Cash to Close:
• From Borrower: $422

Annual Percentage Rate (APR):
• 6.978%

Total Interest Percentage (TIP):
• 130.549%

Considerations:
• Prepayment Penalty: None
• Balloon Payment: None
• Late Payment Fee: 5% of overdue payment if more than 15 days late.

2
  • 30-year fixed refi with no cash - 6.625% - 0 points - $250 lender credit
    • $7000 cheaper if it’s a no-cash-out refi
  • 30-year fixed cash-out - 6.625% - $600 in points
    • $6500 cheaper for cash-out refi

The same fees would be about a 5.875% rate

3

This doesn’t look like a good deal.

4

What’s your yearly income, and is this a conventional loan?

5

Rates have gone up a lot this past month. It’s probably not the best time to refinance if your current rate is below 7.25%.

6

2.3% in points? No wonder they’re matching other offers :joy:

7

At 6.625%, with those high origination costs and discount points ($11,357), your rate should really be closer to 5.575%! That’s way too high for this deal.