ST Alpha - "My mortgage company (Quicken) called me this morning. They want to do a no-cost-to-me refinance. I'm confused." (Reading a Post)

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My mortgage company (Quicken) called me this morning. They want to do a no-cost-to-me refinance. I'm confused.

Posted by Covington (aka CovingtonCat) Sep 23 '14, 08:13

She said they do annual rechecks and since my credit is so good (802) Quicken feels I might be able to lower my monthly payments (by $50) or shorten the loan period (by 1 year). She said they might even be able to eliminate the PMI ($75/month). This sounds too good to be true? Right?

I asked her what Quicken has to gain other than goodwill. She said it was exactly goodwill. Quicken is highly rated by JD Power and wants to retain their #1 status.

She mentioned refinancing for 30 years (I'm only 11 months into my current 30 year loan). I said I'm going to be a very old man at the end of the original 30 years and don't want to be even older with a new loan. So she's looking at refi for 29 years, still with potential of reducing my payment by $125 (if they can eliminate the PMI which I thought I was stuck with until I had 20% equity).

I told her to go ahead. She'll call me back later today. She did not guarantee anything so I'm not spending the savings just yet.

Has anyone gotten this kind of call? Is there something I'm not getting that I should beware of? Is there an advantage in shortening the loan period vs. lowering the payment?

Responses:

"no cost to you" can mean many different things. make sure they're not just rolling the closing fees into the principal of the new loan. - znufrii Sep 23, 08:17 16
- I have done several no cost to me refinancings and been called by my bank (Chase at the time) to do the same. It's often because they just don't want - pmb Sep 23, 08:25 1
  - Ah, this sounds like what's happening here. She did say Quicken would remain the servicer. - Covington Sep 23, 08:47
- *this* This is where they make their money. -- nm - spamlet Sep 23, 08:19 11
  - yeah, there is no doubt fees involved, which will be included in the borrowed amount. - groiny Sep 23, 08:20 7
    - Yeah, the girl may just need to land a certain number of re-fis this month to get her bonus or quota. -- nm - Spawn Sep 23, 08:22
    - right. - znufrii Sep 23, 08:21 5
      - yes and no. - groiny Sep 23, 08:22 4
        
        if you expect to stay in the home that long, sure. -- nm - znufrii Sep 23, 08:28 1
        
        no one expects to stay in a home that long. nm -- nm - groiny Sep 23, 08:28
        
        but you should always *know*. -- nm - Andie Sep 23, 08:25 1
        
        of course, but even if fees are involved, it is probably a good deal. - groiny Sep 23, 08:26
  - That does not mean it can not be a win/win, though. -- nm - Spawn Sep 23, 08:20 2
    - oh, sure, if he can keep the same payment and lower his term (i feel like it should be more than a year reduced though), then go for it. -- nm - Andie Sep 23, 08:26
    - Right, but they're not just getting customer goodwill. -- nm - spamlet Sep 23, 08:21
- Don't know yet -- nm - Covington Sep 23, 08:19
- yeah at the very least there is a new " loan fee". right? -- nm - Epiphany Sep 23, 08:18
In the fine print, Quicken will be allowed to install a service monitor if they choose. - Spawn Sep 23, 08:15
shorter loan period=less interest paid. -- nm - Reagen Sep 23, 08:15

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My mortgage company (Quicken) called me this morning. They want to do a no-cost-to-me refinance. I'm confused.

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