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german · 10-31-2007, 02:09 PM

I suspect my son has an ARM and has one more year to refinance before the interest rate changes. Is there normally a penalty involved if he refinances before the adjustable rates kick in?<br />

city_guide · 10-31-2007, 02:09 PM

Daisy....I refinanced my mortgage (a fixed rate mortgage) twice in the first 4 years....and yes...get a fixed rate ASAP.

I'm not sure about any penalties for early refinancing of ARM's. I've heard that some do and some don't. He has to check his mortgage paperwork.

***

007 · 10-31-2007, 02:09 PM

There COULD be a penalty, you need to call your lender. Also, DON'T go to a broker. Go to a BANK! Their fees are much lower and so are their rates.

The only problem is that condo's do not appreciate in value like homes. Adding in the fees, you could owe more than the condo is currently worth.

quicken · 10-31-2007, 02:09 PM

yes you can refi at any time you want...
there will only be a penalty if he has a pre-pay on the mortgage...if he were to refi with the same bank they might wave some of it too, if not all. they want your business. especially at this time in the market.
other wise if he goes with a different lender they might work the fees into his new loan.

this is only if he has a prepay, otherwise he is free and clear

city_guide · 10-31-2007, 02:09 PM

He needs to read the fine print. Some lenders have prepayment penalties that make it costly to refinance.

bigbuck · 10-31-2007, 02:09 PM

penalty? no always. check his Adjustable Rate Note or call the lender. then figure out how much penalty vs how much add'l interest you'd have to pay if you miss good rates (going up, up..). pls. feel free to contact me with details - I'll give you opinion supported by numbers.

50cents · 10-31-2007, 02:09 PM

There shouldn't be. Just talk to the bank, or another one. Most are happy to do business with someone with good credit. Laws are different in different states. In IL, they used to require a new appraisal. But if you kept the same bank, maybe not. I looked into refinancing one time, but it wouldn't pay to do the paper work, as I was far enough into the mortgage to be paying more principle. So, it wouldn't pay with the savings compared to the refinancing costs. Some banks will do it for free on larger mortgages.

coolio · 10-31-2007, 02:09 PM

only if he has a prepay penalty which should have been disclosed to him at signing the paanpers. However he can refinance the more equity he has in the property will be in his favor. It all depends on who he goes with. If he does not know if he has a prepay or not tell him to contact a broker and have them look into it for him and what kind of rate they can get him right now if he does not have a prepay.

BOB+ · 10-31-2007, 02:09 PM

You can refinance at any time. You need to pull his copies of the loan to see if his lender placed a prepayment penalty on the loan; this would have to be disclosed on the paperwork he signed. Some loans have them while other loan programs do not. If he does have one then you need to find out how much it is and then have a lender to work up a quote that he qualifies for to see if paying off the loan now is cost efficient.

realtime · 10-31-2007, 02:09 PM

You can refinance, as long as there is enough equity in the property. The fixed rates are good now too. As far as the prepay penalty, you'll have to check the initial document your son signed at closing. It should be on the note. Just call up the bank that holds the note. They may even offer to do it for him at a reasonable cost. Good borrowers are really in the driver's seat right now. A bank would certainly rather give someone a lower fixed rate as opposed to raising it and hoping they are able to make the payments. Call them up and check it out.

Good luck.

10-31-2007, 02:09 PM	#1
german Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	Can you refinance your mortgage after living in a condo for only two years? I suspect my son has an ARM and has one more year to refinance before the interest rate changes. Is there normally a penalty involved if he refinances before the adjustable rates kick in?<br />

10-31-2007, 02:09 PM	#2
city_guide Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	Can you refinance your mortgage after living in a condo for only two years? Daisy....I refinanced my mortgage (a fixed rate mortgage) twice in the first 4 years....and yes...get a fixed rate ASAP. I'm not sure about any penalties for early refinancing of ARM's. I've heard that some do and some don't. He has to check his mortgage paperwork. ***

10-31-2007, 02:09 PM	#3
007 Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	Can you refinance your mortgage after living in a condo for only two years? There COULD be a penalty, you need to call your lender. Also, DON'T go to a broker. Go to a BANK! Their fees are much lower and so are their rates. The only problem is that condo's do not appreciate in value like homes. Adding in the fees, you could owe more than the condo is currently worth.

10-31-2007, 02:09 PM	#4
quicken Greenhorn Join Date: Jul 2006 Posts: 27 Rep Power: 6	Can you refinance your mortgage after living in a condo for only two years? yes you can refi at any time you want... there will only be a penalty if he has a pre-pay on the mortgage...if he were to refi with the same bank they might wave some of it too, if not all. they want your business. especially at this time in the market. other wise if he goes with a different lender they might work the fees into his new loan. this is only if he has a prepay, otherwise he is free and clear

10-31-2007, 02:09 PM	#5
city_guide Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	Can you refinance your mortgage after living in a condo for only two years? He needs to read the fine print. Some lenders have prepayment penalties that make it costly to refinance.

10-31-2007, 02:09 PM	#6
bigbuck Greenhorn Join Date: Jul 2006 Posts: 29 Rep Power: 6	Can you refinance your mortgage after living in a condo for only two years? penalty? no always. check his Adjustable Rate Note or call the lender. then figure out how much penalty vs how much add'l interest you'd have to pay if you miss good rates (going up, up..). pls. feel free to contact me with details - I'll give you opinion supported by numbers.

10-31-2007, 02:09 PM	#7
50cents Greenhorn Join Date: Jul 2006 Posts: 16 Rep Power: 0	Can you refinance your mortgage after living in a condo for only two years? There shouldn't be. Just talk to the bank, or another one. Most are happy to do business with someone with good credit. Laws are different in different states. In IL, they used to require a new appraisal. But if you kept the same bank, maybe not. I looked into refinancing one time, but it wouldn't pay to do the paper work, as I was far enough into the mortgage to be paying more principle. So, it wouldn't pay with the savings compared to the refinancing costs. Some banks will do it for free on larger mortgages.

10-31-2007, 02:09 PM	#8
coolio Greenhorn Join Date: Jul 2006 Posts: 21 Rep Power: 6	Can you refinance your mortgage after living in a condo for only two years? only if he has a prepay penalty which should have been disclosed to him at signing the paanpers. However he can refinance the more equity he has in the property will be in his favor. It all depends on who he goes with. If he does not know if he has a prepay or not tell him to contact a broker and have them look into it for him and what kind of rate they can get him right now if he does not have a prepay.

10-31-2007, 02:09 PM	#9
BOB+ Piggy Bank Join Date: Jul 2006 Posts: 96 Rep Power: 6	Can you refinance your mortgage after living in a condo for only two years? You can refinance at any time. You need to pull his copies of the loan to see if his lender placed a prepayment penalty on the loan; this would have to be disclosed on the paperwork he signed. Some loans have them while other loan programs do not. If he does have one then you need to find out how much it is and then have a lender to work up a quote that he qualifies for to see if paying off the loan now is cost efficient.

10-31-2007, 02:09 PM	#10
realtime Greenhorn Join Date: Jul 2006 Posts: 27 Rep Power: 6	Can you refinance your mortgage after living in a condo for only two years? You can refinance, as long as there is enough equity in the property. The fixed rates are good now too. As far as the prepay penalty, you'll have to check the initial document your son signed at closing. It should be on the note. Just call up the bank that holds the note. They may even offer to do it for him at a reasonable cost. Good borrowers are really in the driver's seat right now. A bank would certainly rather give someone a lower fixed rate as opposed to raising it and hoping they are able to make the payments. Call them up and check it out. Good luck.

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