Refinancing with My BFF!

I'm no Alan Greenspan but I suspect the recent decline in mortgage interest rates will be as short-lived as an appearance by the sisters Spears at a Planned Parenthood meeting. Therefore, I've been looking for options to refinance my mortgage and my outstanding home equity line of credit (HELOC) balance.

My equity has not been used as my personal piggy bank for hair plugs fancy vacations or lipo and I tried to wisely use my HELOC to replace mechanicals, remodel a bathroom and update the kitchen-- all jobs that I am assured on HGTV I will receive close to a 100% rate of return on my investments. Or at least they said so last season. My concern though was that since the HELOC is a variable rate product at some point in the high interest rate future it will be difficult to make the increasingly large payments on my not so high non-profit salary.

After some online research I found a rate that I thought was really good. Really good! Since my loan hasn't closed yet I won't reveal the name of the mortgage company but it is the one that currently services my mortgage and is often mentioned in relation to the mortgage meltdown. Let's just say it kinda rhymes with County Slide Mortgage.

My County Slide mortgage consultant, Bo was your typical frat dude turned telephone sales guy. He wanted to have fun. It's Friday!!! He confidentially told me wanted to make his boss mad and find me a great deal. He wanted me to join him me doing body shots off of the loan processor. He wanted to be my BFF!!!!

I'm a very poor negotiator but I know that saying "I need to think about it overnight" after a lengthy discussion of loan terms is like saying "I think HE is innocent" to Nancy Grace. Lots of frothing at the mouth ensues and considerable effort action will be taken to prevent you from having the last word. Ever.

Points started coming down. Fees shaved. Rules bent. "Dude my boss will kill me but..." However, my great rate stayed the same. I agreed to proceed with the application and Bo-bro and I engaged in a series of telephonic congratulatory chest bumping.

Since I was already a customer and have a good credit score, the loan was eligible to be a "Fast Track" mortgage. No proof of income. No new appraisal needed. Am I really that good of a BFF? Shouldn't County Slide at the minimum ask to be my friend on MySpace first? Isn't this how the mortgage crisis occurred to begin with? Regardless, Bo-dude and I would be rolling a big fat HUD-1 and smoking it in seven days to celebrate.

My main shortie Bo explained to me that my appraisal on file would be used to calculate my current value:

"In 2005 your house was appraised for $XXX, XXX. Our computer program now shows it is worth $YYY,YYY. "

OUCH! Bo-boi you and your computer are killing me!!!!

I've lost over 20% of my appraised value in three years? Does the DC Office of Tax and Revenue know this? I've updated the kitchen and bathroom! Have you seen my new boiler? I think this is when on TV they cut to commercial and the HGTV hostess is attacked with a satin nickel towel bar, her head violently slammed against natural stone counter tops before stuffing her lifeless body into a stainless steel bottom mount refrigerator.

"Uh oh" said the Bo-ster. "Unfortunately, we DO need to get an appraisal. Your property is rated in a '3' zone which means it is in a soft market. This will delay your funding another week to 10 days."

I am at the age where the word soft is normally only welcome in relation to "food" or "porn" but I didn't think this was a deal breaker. However my Bo-meister wingman was determined to Fast Track my deal so we could cash out in time to head to Spring Break together.

"Let me try this. I'll lower your appraised value and submit it again. OK. That worked. Awesome! We should be closing in seven days."

So in the space of a 30 minute phone call I lost 20 % of my home equity and now the consultant lowered it even more to get my loan approved without an appraisal? I've been Fast Tracked! Shouldn't I be celebrating?

I'm not complaining. Much. I have a great low rate (4.125%). My new payment is less than my combined mortgage and HELOC payment were before with about a two year payback to cover points and fees.

I also have a new BFF. Bo, call me! Seriously, we can get manny peddies.

But somehow despite being Fast Tacked I feel a little poorer.