Why 5 stars? Because this was definitely our most pain free refinancing option.
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A friend of ours recently refinanced their mortgage at a lower interest rate to lower their payment. The idea intrigued us, especially dating back to the earlier stages of COVID when future finances were so uncertain. We looked into using the same company that our friend did, but they said for weeks that the market was so volatile that they couldn't secure any rates. After several follow-ups with them, I reached out to two other companies: my former mortgage holder (Flagstar) and Prolending Mortgage. Prolending is based in the Houston area, but I chose them because my Mom is a local realtor there and works with Dru Brents all the time, which added to my comfort level.
I felt that Dru was significantly easier to work with than the other two companies. He seemed very transparent and open about the whole process, while I definitely got a very "used car salesman" type of vibe from the other guys. On a video call, he even showed me the software that he uses to produce the rates so that I could see exactly what he sees. I'd highly recommend using Prolending for a new home or a refinance, regardless of where you live.
As for others who might possibly be interested in refinancing, I'd like to share a breakdown of the costs. These figures are specific to my mortgage amount and I'm sure they will vary state-to-state and year-to-year, but this will hopefully provide a ballpark range for anyone interested in a ReFi.
Our old interest rate was 4.125% and our new one is 3.25%.
The total cost for our ReFi was about $3500. About $2200 of that was up front and the rest was rolled into the mortgage.
The cost was actually closer to $7800, but we received about a $4200 escrow refund from our old mortgage company after the fact. The total net cost was about $3500 after that refund factored in. We actually received the escrow refund in two parts - the second check came after I'd already written the review, so I updated these figures.
This lowered our payment about $180 a month. It actually lowered it about $230 a month, but $50 of that was from finding a lower insurance rate. The mortgage payment itself was lowered $180.
This means that it would take one year for us to break even with our monthly mortgage savings from our upfront costs and about 19 months to break even from our total costs. Also due to the change in mortgage companies, we were able to skip two months of payments before officially starting the new loan.
Hopefully that's helpful for anyone who was totally ignorant about this process like I was. But if you do decide to go forward with this, definitely use Dru! read more
