Adventures in Re-financing a Mortgage

The Monday before Thanksgiving, the transmission on my van gave up the ghost. I was on my way home from work and the van decided that was the moment. Luckily, there was just enough life left to get off a main street onto a less main street in downtown Bradenton.

I got it towed home, took the next day off from work, because being shuch short notice I had no way to get to work. We had already planned on renting a car to go to Melbourne for Thanksgiving, so that was just a metter of moving the pickup time from afternoon to morning. I was late getting to work, but was able to arrange that. My Other Half had already had the van towed to a local shop for diagnosis and repair. I won't name the shop, but it is a national chain.

This being a long holiday weekend, was not a good time to have car trouble. The person who would do the work wouldn't be in until Monday. The repair work was going to be about $3,000. I nearly passed out. We don't have that kind of money laying around. And, as it turned out, they wouldn't start the work until they knew we could pay for it. Understandable. They offered a loan, but as it turned out, we didn't qualify.

When my brain finally cleared, I realized that if we could re-finance the mortgage, it might be the answer to several problems, the most pressing being getting the van fixed. So, I went on Lending Tree and entered all the required information. Lending Tree says that you will get at least four offers within hours. Well, I got 12 right off the bat and more the next day. The next day, I was fielding calls from people who wanted to give us money! Well, in exchange for the deed to the house and monthly payments, but you understand what I mean.

We live in a condo. All of the units in this complex are exactly alike. And I mean the same floor plan. Individual owners may have taken up carpet and replaced it with tile, or made other cosmetic changes like that, but the design is the same in every condo. I recently saw that a unit across from us was for sale. I checked it out on the realtor's site and started doing mental backflips! It was selling for nearly three times what we paid four years ago! Now, this was an end unit, meaning that they have a condo on one side and a common grassy area on the other side. They also back up to the end of the propery, so while there is an apartment complex behind them, there are no condos behind. Because we have condos all around us, we figured we could get about $10,000 less.

I had never re-fied before and had no idea what our condo was worth. I only knew what the condo across was selling for (but hadn't sold), not what either was appraised at. I told everyone who called about the condo across and everyone seemed to think that I was correct in "assuming" that since it was selling for (but hadn't yet sold - I was sure to mention that) this amount, we should be able to appraise at close to this figure.

We settled on a mortgage lender and arranged for an appraisal the next week. I was right in figuring that our condo would appraise at about $10,000 less than the end unit across the parking lot. Happy days! So far, so good.

We got a lower interest rate than we were paying (down a full one and a quarter points), a 15-year fixed mortgage (down from a 30-year fixed - wouldn't have anything but a fixed), we rolled all our credit card debt into the mortgage and came out paying less than we were before. I had intended to roll the car loan into the mortgage but there was a misunderstanding and it didn't get in. That's okay, I'll know better next time we do this. We even got cash out! And, we still have enough equity that we aren't paying PMI! Yay! Another plus!

We arranged to close the loan on the 15th, but the closing was changed and we signed the papers on the 13th. Our mortgage banker told us that we would get our checks on Monday (the delay was the 72-hour change of mind clause thingy). Now, here is where you need to pay attention. My friend Tina, who happens to bank at the same bank we do, ran into a problem when she re-fied a couple of years ago. Deposited money in excess of $5,000 would be held for ten working days.Tina said it had to do with The Patriot Act, and large sums of money laundered to support terrorist groups. I hit the roof and called the bank. Turns out Tina was wrong, or the time length had changed, it was now eleven days. I would have access to the first $5,000, but the amount over that would be held. Now, if you are like me, I took exception to this. That's my money, I want it NOW!

I know that terrorist can re-fi a mortgage to get money finance a terror cell, but neither my husband nor I have any ties to any terrorist organizations. That's not how the lady at the bank explained it to me, but it makes more sense than what she said. If this is what came out of the Patriot Act, then it's assuming that everyone is guilty of aiding terror groups without any proof. I don't like that. Let me have my money then prove that I used it illegally. That makes more sense, and would make more sense from a law enforcment point of view. It would be good, solid evidence to build a case on.

Well, there is away around it and this came from the lady at the bank. Have the money wire-transferred into your bank account. It cost $50 out of our proceeds to do it, but we got the money. Well, eventually.

Now we come to the glitch. The money was to be wired into our bank account on Monday. I watched for it all day Monday and into Tuesday morning (thank goodness for electronic banking!). It never showed. We were told that it might not be transferred until late Monday, so I didn't panic until Tueday morning. I had paid the bill on the van, a couple of other bills, and bought groceries. It was the van bill that I was concerned about! The rest we had money for. I called our mortgage representative around 11:00 am to see what the problem was. Turned out, the lady who handles wire transfers and disbursement of funds at the title company was out sick and the lady who took over for her didn't read (or maybe didn't see) the instructions to wire the money and sent a check instead. This is what we were trying to avoid! Anyway, it was straigthened out with a phone call from the mortgage company to the title company. The money was transferred, but we would also get a check in that amount. We were asked to void the check and mail it back to the title company. This has been done - gladly. The title company overnighted checks to pay the credit card companies. I could have allowed them to pay them directly, but I wanted the pleasure of mailing the checks myself. It was a very nice feeling to put those checks in the mail, by the way.

We have our money, a new mortgagewith a lower interest rate and a shorter term, the van has been fixed (although that took three weeks of car rentals which ate into our profits from the re-fi and is a whole 'nother matter) and paid for, the credit card debt is paid in full, our bills are up to date, we're saving almost $500 a month over what we were paying out and we don't have to make a mortgage payment in January. Whoo-hoo!

We have several things planned that we want to do with the profits. My other half is getting his van fixed (depending on how much it will ultimately cost), we're both getting new glasses (at our ages, this can be expensive!), the dishwasher and garbage disposal are being replaced, and maybe the hot water heater. That's a little farther down on the priority list, because it "seems" to be okay right now. But considering it's age, and since we have the money, it might be prudent to replace it now.

And Christmas shopping was a pleasure this year. We didn't go overboard, but we did actually buy each other real gifts this year, and not stuff that we need, we got things we wanted. My other half is getting a new monitor for his computer.

No, we're not rich, and it will take a couple of months to adjust to the new mortgage, but, I feel better than I have in months. It's true, money won't buy happiness, but it will sure allow you to sleep a little easier. 2006 should be a better year for us financially.

Note: If anyone is interested in re-financing their mortgage, I'll be happy to give you the information to reach our mortgage banker. Just send email requesting the information.