Consider ARM as well
Hi,
If your loan amount is more than 322K then is considered as Jumbo loan. The rates are little higher.
So if possible, it is good idea to get below Jumbo loan for a better rate .
Secondly, you can get much better rates for 3/1, 5/1 ARM rates. Whatever you save by paying low installment can be yours towards principle. I took 5/1 ARM at 5.75 last year again refinancing it next month for another 5/1 for 4.75%
Last year, few of my friends told me to go for 30 year fixed, you are making a mistake in not taking advantage of lowest rate in the history blah..
Trust me 5 years is a long time, you may move to something bigger or to a different place altogether. So money in your bank is much better than so called additional security of 25 years of lower rate.
Besides, if you pay little extra in the first five years or so the principle will be a lot less at the end of 5 years and then you can either go for another 5/1 ARM or 15 years fixed.
Who knows, the rate might drop even little further and you can take advantages of even lower rates.
BEWARE OF REFINANCING COSTS, TRY TO GO FOR LOW OR NO COST REFINANCING.
**** AVOID CHASE-MANHATTEN **** IS REALLY BAD IF YOU DO NOT HAVE GC ***** It created a lot of problem for me on my first loan at the last moment. and had to go for higher cost loan. It was not isolated case a couple of my friends had the same problem. Talk to your mortgage broker that you do not want Chase. Citi is OK but charge a lot of fee in refinance. Has anyone tried Priceline or ING direct? They seems to have very good rate and very low closing costs.
All the best in getting your GC and mortgage.
CRU.
