Mortgages, Lynnwood: Using Zillow Mortgage Marketplace for home refinances

Today I’d like to talk to you about a great online tool for finding Real Estate agents and Loan Officers, Zillow Mortgage Marketplace. Zillow is a free to use website that allows you to share the details of the property or loan you want with hundreds of real estate agents and loan officers. They then respond to your claim with their best offer, thus allowing you to quickly and easily browse a list of offers in order to select the best one suited for your needs. Today I’ll break down the details of finding a good quote on home refinances using Zillow, and I’ll show you resources that can tell you rather or not you should act quickly or be patient with your loan.

So you’ve submitted your loan quote requests to Zillow Mortgage Marketplace and now have a list of quote offers in front of you. One of the most important details is how much is your loan going to cost. Typical refinances for the Lynnwood, Bothell, Edmonds area are roughly $4,000 for a “par rate”. Par rate is 0.125% to .25% above the yield Fannie Mae sets for loans, which can be found here:

https://www.efanniemae.com/syndicated/documents/mbs/apeprices/archives/cur30.html

I have an amazing calculator that prices your individual risk and determines the rates and cost available for a refinance or purchase loan for your situation at http://seattle.rateswire.com/calculator which you should use to understand how different rates and costs fit your goals.

Rate quotes you receive from Zillow are based on the rate the lender gets from Fannie Mae. So remember to check the date on your quotes against the rate on the day the quote was put together! If rates are moving rapidly a local Lynnwood lender like myself can sit down with you to make sure no problems will arise, take the application, and wait until a good time to lock.

To get the final cost of the loan we calculate how long it will take to recover the closing costs using this formula:

Yrs to recover costs = Costs / Savings/yr = $4000 / (Current Balance * Current Rate - (Current Balance + (your closing costs)) * New Rate )

You were probably under the assumption there would be no math! So let me clarify with an example. For a $200,000 loan at 6% converted to $204,000 at %5 will take around 2 years to break even. If the recovery time is 1-4, then it’s a good deal, as the average person owns the property for 7 years.

The next detail to examine is if rates are rising or falling. When rising, you need to act quickly to obtain a lock on the Zillow quote the lender offered. A good resource to find 30 year yields *not price* is Bloomberg’s web site at:

http://www.bloomberg.com/markets/rates/index.html

If the yield is rising and it’s worthwhile in terms of recovery time to go ahead with the refinance, act quickly in order to get a lock as soon as you can before it goes up any more. If rates are falling and the recovery time is favorable, you have the luxury of time allowing you to shopping around for the best lender for your situation. The loan officer you pick can then wait with your application and documents on file until the perfect time to lock!

I hope I was able to give you insight on when to jump in and get the ball rolling on your loan rather than waiting and letting an opportunity pass you by. If there is any uncertainty in your application or questions you have, it’s a good idea to use a local lender so that you are able to meet face to face and resolve the problem and keep the lock you just spent so much time obtaining. I am two miles south of Lynwood which helps me provide in person service and problem solving to Lynnwood, Bothell, Bellevue, Seattle, and the 405 and I5 corridors. If you have any questions or concerns I’d be happy to help you, my contact information is on the right hand side of the page. Good luck with your loan!

Edit: I do not have time to provide quotes to everyone on Zillow in Washington State. So if you do not see one of my excellent qoutes please visit my website at http://seattle.rateswire.com/calculator to see a full breakdown of rates and fees including title, escrow, and prepaid interest which is not included in Zillow fees.