With the right WACC and discount rate you can talk yourself into or out of any investment. Even buying a UTC condo for the octogenarian client’s life estate.
To do either there needs to be answers to the questions i posed. I asked them because last refinance I did it was still Wild West.
Short of some wacky discount rate or exorbitant not mentioned cost, the NPV on your refi scenarios greatly favors the refi. Per my numbers above on mine the PV of FV of $33k ish is around $17.5k.
If the riefinance is “no cost” then a 0.125% no cost refinance with partial point credit back is worth doing regardless of loan amount. If that scenario doesn’t make sense, then there are other costs not being covered by “no cost” or a float issue with your other expenses to close.
I have no problem with brokers making money, it’s like real estate agents. it’s the cost of doing business. I like to know up front how my partners in a deal are making money and roughly how much.
Years ago, you could deal with a bank and they’d tell you the rate was 4%, you’d then call a broker, theyd tell you 3.75% and he’d make a nice commission on it. And it would be with the same bank. The broker provided a service so its fair they get paid, the financial sector though was treating me like a cow to be milked. Has that changed?
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