I’m seeing 3% from LenderFi on a 30 yr with enough credit to cancel out closing costs. That’s in WA though on a $375k loan. Might want to check them out, they are a correspondent for PennyMac.
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Did so. Not as much as a penalty moving individual rate steps between no lender fee and no cost. But their rates are higher than Box for my loan terms (even with the “penalty” 0.5% at Box to go no cost). 3.875% vs the 3.5% (it lowered from earlier) at Box. For no lender fee it’s 3.25% vs 2.875%.
Quotes for your loan’s terms are about equal at both places.
Edit: wow, actually it looks like most of the “penalty” i’d been seeing when sporadically checking and early this morning is mostly gone away now 
(@ box where I was checking).
Double check Provident in that case. Box (at least used to) write loans for Provident and so their pricing usually changes in lock step.
For a 150k loan in Texas is below. If you can snag their employer program, you get another quarter point credit towards closing costs (not off their rate - my mistake).
Unfortunately not a workaround I know of for provident to get the discount if employer hasn’t signed up. Yes, 2 of 3 of my box loans initially sold to provident. A relative’s did not.
Same w/ box for the quarter point (but no employer needed, there’s a Slickdeals referral link). Will look when/if I get to it. If I remember right, provident’s third party fee estimates are tricky or there’s an origination fee or something…
My last one got resold (last year) to Loancare Servicing and they’re a PITA.
I definitely don’t see a 0.5% rate penalty or anywhere near that. If anything, it’s closer to 0.125%. But this depends on the amount – smaller loans are more expensive (a $200K loan is more expensive than a $400K loan when expressed in points, cause they do the same work regardless of the loan amount).
The lender I’m looking at (raterabbit.com) doesn’t do TX. Their entire business model is that third party costs are rolled into the quote, so it’s been at or near 3% with $0 or almost $0 total cost for my numbers. The only bad thing about them is their credit never exceeds the costs, so you can’t profit from refinancing with them.
Actually, for Provident, you qualify for their “Customer for Life” program since you had a loan serviced by them at some point in the past. That’s the same quarter point credit as the employer program. You either have to have an old promo code from an email they sent, or talk to a rep when you apply to get it.
And I agree with you about LoanCare. They were a caretaker servicer for Better Mortgage, I had them for a month and they were terrible during that time before my loan was sold to SunTrust.
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I’m referring to looking at the chart with rate vs fee. The fixed costs don’t change for changing rate steps. The amount of fee/credit per step should scale with the loan size, of course.
Here’s what I mean:
You can see (for box example above) that for the rate steps where lender credit is offsetting the lender fees it’s ~$1100 or so per step. But then it halves to only ~$550 per 0.125% going between there and “no cost”.
This was not the case before rates dropped earlier this year. There was always more expensive points to buy down the rate lower than a few steps below no cost and a little bit less credit as you increased the rates, but it was not such a large change the times I looked before. It was around an 8 year breakeven on cashflow when I last refinanced (2016) to move even one rate step down from no-cost, whereas now it’s only 40 months ($430/$10.73). At only 40 months breakeven, no-cost is much less attractive.
@sullim4 good point on provident rates they are actually exactly equal with Box right now. That wasn’t always the case in the past, but I haven’t looked since ~4 years ago when I last refinanced. Box also used to sometimes have 2 tiers of rates, a “platinum preferred”(if I remember the name right) requiring extra criteria met, with the separate program only sometimes available.
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If that is the case, then try checking the Zillow fly-by-nights a few times a day. There are a ton of correspondents on there for Provident, and I find that Provident’s retail rates can often be beaten by these guys.
I will say, Provident is an excellent servicer, even if their documentation process is robotic and doesn’t listen to reason. This is one reason why I liked LenderFi (a Pennymac correspondent) - they are a smaller operation but that just made their underwriting process a breeze because the loan officer knew exactly what the underwriters wanted. Pennymac has been a fine servicer as well.
I see what you’re saying. It’s possible that the broker is taking a bigger cut for themselves. It’s also possible that the loan market is jagged. You should see the quotes I’m getting for an investment property refinance – they don’t make any sense. For example, the closing cost for 3.5% and 3.75% is exactly the same, but 3.625% is cheaper than both of them. It has been this way for investment properties since the rates jumped in mid-March.
I’m just going to bump this because rates hit an all time low today:
Supply/demand for mortgages has reached a bit of an equilibrium after the craziness of the initial onslaught of refis when covid hit.
For our parameters, we could cut a quarter point off of our last refi… that doesn’t really move the needle enough for us. 3 mortgages in a year last year was enough .
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Sounds like you haven’t borrowed enough
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Testing new record lows again for my quotes. 30-yr 2.75% all-in, with or without cashout.
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A broker told me that Fannie/Freddie added some rules to disallow lender rebates on investment properties. Not sure if it’s true, but it explains why there’s no obvious trade-off between rate and fees and no “no cost” option.
Our credit union is down to 2.37% with -0.125 points for purchases.
They’re at 2.75% and .125 points for refi though.
-0.125 points is not enough to cover 3rd party fees. But yes, purchase rates are .125-.25 lower than refi for my quotes.
Lel. Some much more than that. Box has a big yellow banner saying they are artificially increasing refi rates because too many applications and not to apply for one. $160k purchase loan amount, 30yr(75LTV), at no cost is 2.75. Refi is 4.375% with$3600 cost. Quite the spread. They say apps are up over 500% at the same time as third parties are slowed down. So it mostly makes sense to prioritize the purchase loans to “stimulate” the housing market. It seems like ignoring the “housing market” and just focusing on the mortgage originator it would actually be more profitable to prioritize the “easy” subset of the refis as they’d be very low effort and also require less third party intervention.
Found out that Credit Karma also has a mortgage marketplace. Looks similar to Zillow, but has other lenders and not as competitive as Zillow for my quotes.
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Back about a year ago, CK’s rates were pretty good and that’s the portal I used to make 2 of my refis. At least in WA, most of the participants are well known in the mortgage world (Better, Sebonic/Cardinal, LenderFi, LoanDepot, etc).
Zillow clearly has a few brokers/lenders fishing for refi business - I’m seeing 30yr @ 2.75 for 0pts and 15yr @ 2.375 for a measly $2 in origination fees from one of the fly by nighters. Otherwise my experience mirrors Bend3r’s, most lenders have full loan pipelines and are actively discouraging business.
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The GSEs have announced a fee on refis. .5% of the loan amount. Take this into consideration when you are shopping around.
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They should have stuck the fee on purchases instead of refis. Wouldn’t those be the riskier loans (typically higher LTV, more questionable appraisals)? But no, they have to prop up bloated home sales prices.
This does suck as people were waiting for the overloaded financing volumes to go down so that they could refi.
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