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Subject:  Re: For Wells Fargo Mortgage Holders Date:  3/10/2003  3:35 PM
Author:  joelcorley Number:  154800 of 312185


You wrote, We don't plan on staying in this house for five years. So why refinance? A couple reasons...we haven't done it before, so our rate is 7.85% ...

That's probably enough reason to refinance right there. One of the advantages of an ARM is that the lender tends to require fewer fees. Another thing to consider is that 3/1 ARMs are probably the cheapest deal on the market right now. is quoting a national average of 3.64%.

Also consider paying negative points. Obviously you want to pay as few fees as possible when you get your loan because that will just increase your principal balance when you finally move. You can actually go the other extreme and ask your lender to pay some or all the closing costs out of their pockets. This is usually referred to as negative discount points. Negative discount points will increase your interest rate; but if you plan to be in the house for a short time, it might be a good gamble.

Another thing to consider is how to minimize your closing costs. If you originally financed the house just a few years ago, you can get a discount on new title insurance if you have the old title company write the new policy. Also, you may be able to use any old inspections (e.g.: termite) if they're not too old. The company that did your land survey should also give you a cost-break if you let them update your old survey rather than letting the bank or broker choose someone new.

- Joel
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