Question by Mark B: How can I refinance my mortgage without putting money down for closing?
I already have a 30 year fixed (6.38%) but would like to take advantage of the lower rates now. My mortgage is through SunTrust and (unfortunately) I have never been late with payments and am not in any financial distress.
Is this possible without bringing any money to the table for closing?
Answer by chatsplas
Talk to your lender.
IF you have equity in your property, the costs can be rolled into the loan. Of course this increases the principal of your loan, not a great idea.
Also figure out how long you have to KEEP this home and this loan before you break even on this cost, let alone before you come out ahead.
If it’s NOT a full point lower, it’s generally NOT worth doing, some think it should be 2 full points lower to make refi worthwhile.
Know better? Leave your own answer in the comments!
Yes it is possible, but YOU have to find a lender that is willing to do it.
Yes you may do this and normally a refinance is done that way.
When you speak with a local mortgage banker/broker tell them you would like to roll any cost into the loan.
When the loan close all closing cost will be paid without you having to pay anything out of pocket.
Now there are a few things that are done prior to your loan approval that might cost, these being the appraiser and credit report. These two items might have to be paid up front, but a savvy person such as yourself can negotiate that these fees be reimbursed by the mortgage banker/broker once the transaction has closed. There fore you will not be our of pocket for anything.
Now if you are financing simply to lower your interest rate thus lowering your monthly payments you will not be getting any money back out of the refinance.
If you are refinancing to lower your interest rate as well as some cash out to pay off credit card debts or make a large purchase then the expense for the refinance would be taken out of the loan proceeds and you will be issued a check for the remainder that is left after all cost are paid.
I hope this has been of some use to you, good luck.