SCENARIO: This homeowner worked with Mortgage Wealth Advisors when he purchased his home two years ago. At the time, rates were higher, and her house has realized significant appreciation since she closed! Over the past two years, Warren Goldberg has stayed in touch with her, checking in from time to time, offering advice and assistance when he could.
PROBLEM: This homeowner recently started receiving phone calls and emails from her mortgage servicer, with offers to refinance. The loan officer on the phone claimed she would save several hundred dollars per month! While this sounded enticing, she was skeptical, as the loan officer impressed her as only a high-pressure salesperson. Since Warren always encouraged her to contact him when she needed advice, she called to obtain his opinion.
DIAGNOSIS: Warren welcomed her call. He reassured her that he was monitoring rates and would reach out once they hit the Strike Rate that they both previously agreed would be needed for a refinance to make sense. Warren ran through his calculations, considering factors such as her current loan balance, current interest rates, and potential closing costs. (While these closing costs can be rolled into the rate, rolled into the loan amount, or paid out of pocket, most borrowers choose to add the costs to the loan amount.)
SOLUTION: Warren confirmed that this loan officer on the phone was not completely truthful with her, had not told her about many of the closing costs, and that the loan officer’s calculations were not accurate. Warren reminded her what her savings would be once market rates dropped to their agreed upon Strike Rate.
RESULT: An expensive and unproductive refinance avoided. And a clear plan in place with both the borrower and her trusted mortgage advisor ready to execute once rates dropped to her Strike Rate.
BOTTOM LINE: As mortgage rates continue to improve, a refinance boom is likely coming. As it approaches, homeowners across the country will receive solicitations from slick and sleazy loan officers hunting for commissions. Do NOT entrust your refinance to these slick salespeople! With 30 years’ experience and a proven track record for looking out for YOUR best interest, I encourage you to call me with all of your mortgage and real estate questions.
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Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, The Daily News, Anton Press, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.
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