- This topic has 85 replies, 10 voices, and was last updated 16 years, 9 months ago by
Deal Hunter.
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February 26, 2008 at 9:14 AM #160523February 26, 2008 at 10:31 AM #160466
ucodegen
ParticipantThe most important thing to do when considering doing a different payment schedule, is look at the loan documents. There may be a prepayment penalty or fee for pre-paying. The penalty may only last for an initial few years. The terms of the mortgage may be explicit as to when you pay, and you may not be able to alter the terms without additional fees.
If you can’t alter the payment terms to allow accelerated paydown of the mortgage, place the difference in a separate account rolling them over into laddered CDs. If you feel more brave, try investing some of the money in mutual funds or stocks (do your own research on which to invest in, don’t trust the suggestions by most of the ‘pros’.)
You may want to check your mortgage. Something is fishy on your payment. You are either paying some serious points or something. A fixed 6.35% I/O on $475,000 should only have a monthly payment of about $2513.54 until it goes amortizing at the end of the 10 year period.
rate / 12 * 475,000 = 2513.54
rate = rate_pct/100 = 6.35/100
February 26, 2008 at 10:31 AM #160548ParticipantThe most important thing to do when considering doing a different payment schedule, is look at the loan documents. There may be a prepayment penalty or fee for pre-paying. The penalty may only last for an initial few years. The terms of the mortgage may be explicit as to when you pay, and you may not be able to alter the terms without additional fees.
If you can’t alter the payment terms to allow accelerated paydown of the mortgage, place the difference in a separate account rolling them over into laddered CDs. If you feel more brave, try investing some of the money in mutual funds or stocks (do your own research on which to invest in, don’t trust the suggestions by most of the ‘pros’.)
You may want to check your mortgage. Something is fishy on your payment. You are either paying some serious points or something. A fixed 6.35% I/O on $475,000 should only have a monthly payment of about $2513.54 until it goes amortizing at the end of the 10 year period.
rate / 12 * 475,000 = 2513.54
rate = rate_pct/100 = 6.35/100
February 26, 2008 at 10:31 AM #160448ParticipantThe most important thing to do when considering doing a different payment schedule, is look at the loan documents. There may be a prepayment penalty or fee for pre-paying. The penalty may only last for an initial few years. The terms of the mortgage may be explicit as to when you pay, and you may not be able to alter the terms without additional fees.
If you can’t alter the payment terms to allow accelerated paydown of the mortgage, place the difference in a separate account rolling them over into laddered CDs. If you feel more brave, try investing some of the money in mutual funds or stocks (do your own research on which to invest in, don’t trust the suggestions by most of the ‘pros’.)
You may want to check your mortgage. Something is fishy on your payment. You are either paying some serious points or something. A fixed 6.35% I/O on $475,000 should only have a monthly payment of about $2513.54 until it goes amortizing at the end of the 10 year period.
rate / 12 * 475,000 = 2513.54
rate = rate_pct/100 = 6.35/100
February 26, 2008 at 10:31 AM #160464ParticipantThe most important thing to do when considering doing a different payment schedule, is look at the loan documents. There may be a prepayment penalty or fee for pre-paying. The penalty may only last for an initial few years. The terms of the mortgage may be explicit as to when you pay, and you may not be able to alter the terms without additional fees.
If you can’t alter the payment terms to allow accelerated paydown of the mortgage, place the difference in a separate account rolling them over into laddered CDs. If you feel more brave, try investing some of the money in mutual funds or stocks (do your own research on which to invest in, don’t trust the suggestions by most of the ‘pros’.)
You may want to check your mortgage. Something is fishy on your payment. You are either paying some serious points or something. A fixed 6.35% I/O on $475,000 should only have a monthly payment of about $2513.54 until it goes amortizing at the end of the 10 year period.
rate / 12 * 475,000 = 2513.54
rate = rate_pct/100 = 6.35/100
February 26, 2008 at 10:31 AM #160152ParticipantThe most important thing to do when considering doing a different payment schedule, is look at the loan documents. There may be a prepayment penalty or fee for pre-paying. The penalty may only last for an initial few years. The terms of the mortgage may be explicit as to when you pay, and you may not be able to alter the terms without additional fees.
If you can’t alter the payment terms to allow accelerated paydown of the mortgage, place the difference in a separate account rolling them over into laddered CDs. If you feel more brave, try investing some of the money in mutual funds or stocks (do your own research on which to invest in, don’t trust the suggestions by most of the ‘pros’.)
You may want to check your mortgage. Something is fishy on your payment. You are either paying some serious points or something. A fixed 6.35% I/O on $475,000 should only have a monthly payment of about $2513.54 until it goes amortizing at the end of the 10 year period.
rate / 12 * 475,000 = 2513.54
rate = rate_pct/100 = 6.35/100
February 26, 2008 at 10:49 AM #160567HLS
ParticipantUCO,
Assuming that the OP knows their rate, they have an impound account of $505, which is what I already factored into my comment above. It’s not fishy at all…
and you don’t pay “points” in a monthly payment.Most loans that have a prepayment penalty allow for paying up to 20% of principal per year without any penalty, so there is never a problem paying an extra payment here or there.
February 26, 2008 at 10:49 AM #160469ParticipantUCO,
Assuming that the OP knows their rate, they have an impound account of $505, which is what I already factored into my comment above. It’s not fishy at all…
and you don’t pay “points” in a monthly payment.Most loans that have a prepayment penalty allow for paying up to 20% of principal per year without any penalty, so there is never a problem paying an extra payment here or there.
February 26, 2008 at 10:49 AM #160484ParticipantUCO,
Assuming that the OP knows their rate, they have an impound account of $505, which is what I already factored into my comment above. It’s not fishy at all…
and you don’t pay “points” in a monthly payment.Most loans that have a prepayment penalty allow for paying up to 20% of principal per year without any penalty, so there is never a problem paying an extra payment here or there.
February 26, 2008 at 10:49 AM #160485ParticipantUCO,
Assuming that the OP knows their rate, they have an impound account of $505, which is what I already factored into my comment above. It’s not fishy at all…
and you don’t pay “points” in a monthly payment.Most loans that have a prepayment penalty allow for paying up to 20% of principal per year without any penalty, so there is never a problem paying an extra payment here or there.
February 26, 2008 at 10:49 AM #160171ParticipantUCO,
Assuming that the OP knows their rate, they have an impound account of $505, which is what I already factored into my comment above. It’s not fishy at all…
and you don’t pay “points” in a monthly payment.Most loans that have a prepayment penalty allow for paying up to 20% of principal per year without any penalty, so there is never a problem paying an extra payment here or there.
February 26, 2008 at 1:34 PM #160622Deal Hunter
ParticipantChevy Chase was selling loans in 2005 that re-am’d only ONCE a year. The teaser rate was 1% over CODI. If you wanted the option of a re-am’ing more often (like every month) you had to pick the teaser rate of 2% over CODI. It was in the fine print underneath the fine print. And yes, it was insanity.
The lender is obligated by law to disclose every aspect of the loan to the borrower – including the re-am period and exact amount of each payment that is credited to interest and principal over the life of the loan. In fact, the escrow can’t close until borrower acknowledges receipt of the Truth in lending disclosure.
OP’s questions are straight-forward enough for a reliable answer from the lender. (I hope.)
February 26, 2008 at 1:34 PM #160555ParticipantChevy Chase was selling loans in 2005 that re-am’d only ONCE a year. The teaser rate was 1% over CODI. If you wanted the option of a re-am’ing more often (like every month) you had to pick the teaser rate of 2% over CODI. It was in the fine print underneath the fine print. And yes, it was insanity.
The lender is obligated by law to disclose every aspect of the loan to the borrower – including the re-am period and exact amount of each payment that is credited to interest and principal over the life of the loan. In fact, the escrow can’t close until borrower acknowledges receipt of the Truth in lending disclosure.
OP’s questions are straight-forward enough for a reliable answer from the lender. (I hope.)
February 26, 2008 at 1:34 PM #160226ParticipantChevy Chase was selling loans in 2005 that re-am’d only ONCE a year. The teaser rate was 1% over CODI. If you wanted the option of a re-am’ing more often (like every month) you had to pick the teaser rate of 2% over CODI. It was in the fine print underneath the fine print. And yes, it was insanity.
The lender is obligated by law to disclose every aspect of the loan to the borrower – including the re-am period and exact amount of each payment that is credited to interest and principal over the life of the loan. In fact, the escrow can’t close until borrower acknowledges receipt of the Truth in lending disclosure.
OP’s questions are straight-forward enough for a reliable answer from the lender. (I hope.)
February 26, 2008 at 1:34 PM #160521ParticipantChevy Chase was selling loans in 2005 that re-am’d only ONCE a year. The teaser rate was 1% over CODI. If you wanted the option of a re-am’ing more often (like every month) you had to pick the teaser rate of 2% over CODI. It was in the fine print underneath the fine print. And yes, it was insanity.
The lender is obligated by law to disclose every aspect of the loan to the borrower – including the re-am period and exact amount of each payment that is credited to interest and principal over the life of the loan. In fact, the escrow can’t close until borrower acknowledges receipt of the Truth in lending disclosure.
OP’s questions are straight-forward enough for a reliable answer from the lender. (I hope.)
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