[Suzanne Oldham – Ambassador]

Recently we were approached by our bank to refinance our mortgage. We currently have two loans: a first mortgage and an equity line that makes up the additional outstanding debt. Both loans are at reasonable rates. When we bought our home several years ago we were unable to secure one “large” mortgage. However, I understand that “jumbo” mortgages have higher ceilings ( about $700,000) and with low interest rates have become more popular. I wonder if we are better off refinancing our two loans into one jumbo first mortgage.

Has anyone in the Sum180 community secured a jumbo loan recently? What questions should I consider?

[Sum180 Lead Coach]

Our view is that it’s all about rates and fees, Suzanne. Ensure your banker gives you a detailed and completely comprehensive cost comparison of staying where you are and pursuing the new mortgage. The data will tell the story.

We’ve found that the real hit on costs with refinancing of any kind of mortgage, assuming rates are comparable, are in the closing costs. Certain aspects of closing costs are negotiable – origination fees, title insurance, homeowner’s insurance, etc. These are things you shop around for or ask to be reduced. Others are pretty set in stone – appraisals and credit report fees, for example. Compare carefully and ask questions if something seems vague. Odds are, if its vague, its “padding.”

[Anthony Johnson]

I’ve wondered this too. Should I look at this before doing a regular mortgage?

[Antoinette Minor – Ambassador]

I think the best bet is to look at the overall fees and then to use a debt calculator to see how long it would take if you kept the loans separate or if you lumped them into a jumbo mortgage.