Seems like a decent deal even with a payback period of 16.3 months. I just purchased the home in March and now I have a chance of getting a 30 yr fixed rate of 3.125 with no points. Closing costs are estimated at $2,533 with a credit of $377. Main question is do you think rates will keep dipping or am I being to greedy? Take the 3.125 and be extremely happy in 5 years when rates are 6%+?
Those costs seem high...or the lender credit is low. Many lenders are covering almost 100% of fees. Have you shopped around?
FWIW, I refinanced about six months ago to a 15yr @ 3.625 and it cost me about $700 total. I'm about to refi again @2.75 (also 15 years) but lender is covering almost everything - I'll be out less than $200....but the lower rate is saving me $160 per month.
That cost is actually pretty standard for the area (Wichita,KS). I am dealing with Kansas state bank. I think I could get a zero cost refi but my rate would be 3.5 and with a lower rate over the 30 years will out way the up front cost. I will actually pay the same amount just have the excess go towards principal.