posted: Jun. 11, 2010 @ 1:20p
Background: I was 2+ years into a 15-year fixed mortgage at 5.625% with Chase already. Quite happy with their service. No escrows for taxes or insurance. Liked the ability to just walk into any branch and make a payment that gets credited the same day. But for the past 6 months I've been trying to refinance and get a lower rate.
It has been difficult to track rates. One thread in this forum gives MBS which is inversely prop. to rates but it's still difficult to figure out actual rates. Bank e-mails always seem to quote higher rates than I think I can get, and the 1 or 2 lenders I talked to insist on an application to even keep sending me rates. I was concerned about credit history hits due to applications - I know they get lumped for some time but not if the refi search goes on for a long time.
I called Chase a few weeks back on my own. Yes, they could refinance - with closing costs, fee, etc. - nothing special. They also kept sending letters asking me to call for lower rates. I still had to work out when/whether these costs will be recovered thru the savings, so I never called back. And then things changed ...
Exactly two weeks ago, through FedEx, Chase sent me another rate reduction notice. The FedEx caught my attention obviously - but this letter also promised zero closing costs and a locked rate of 4.25% for a 15-yr fixed. Sounded too good to be true. Internet searches vaguely mentioned these as scams, but I decided to call the number anyway. It seemed authentic since the person at the other end (Chase Home Finance in Ohio) had all the details about my existing loan as expected. He confirmed again that there would be no closing costs at all. My monthly payment would drop by about 25%. All I had to do was fax them a 1-page borrower authorization form and proof of homeowner's insurance.
In 3-4 days I received a package at home with a GFE. No surprises there (Loan Amount = Principal owed on prev mortgage + outstanding interest on prev mortage + first partial month's interest on new mortage). The following were all credited back by Chase leading to a zero increase in loan amount: Title Service and Lender's title insurance ~ $1250, Tax service to Chase ~ $45, Govt recording fee ~ $190. No appraisal fees and what-not. Eveything looked ok, but I was planning to read through it again before 'sending it back'. But the next day I got a call from Chase asking me when I would like to schedule the closing (Apparently there was nothing to 'send back'). We decided on a day 4 days away - a local notary from the title company showed up at my place (a couple of states away from Ohio) and the closing was done.
The whole process from receiving the Fedex to closing took two weeks. It was fairly effortless. There was some back and forth over very minor amounts - and a $40 recording fee (for the old loan, I was told) showed up at the closing when I was told it would not. Minor things obviously.
The new loan has no prepayment penalties. I didn't feel a need for a lawyer since things were very straightforward. No points. No fees for removing the tax/insurance escrow. Just a rate drop from 5.625% to 4.25% with no closing costs. Obviously, a 2-year extension to the term of the loan, and two months of interest-only payments.
One more thing: The new loan account is eligible for a 1% CashBack every year on the regularly owed principal+interest payments.
I have no connections to Chase other than being an off-and-on customer over several years.