State Farm Mortgages?

smerka · April 2017

i called my insurance agent to discuss umbrella policies this week. He told me State Farm now does mortgages and their closing costs are $500. Anyone have any experience with them and mortgages? I've been wanted to refinance for a while as our rate is 4.625 on a 30-year fixed but the closing costs have always been crazy since our loan amount is relatively low ($130,000).

jtmh2012 · April 2017

I can't speak for state farm for mortgages, but have you tried refinancing through the same bank your loan is already with?

We have ours with Chase and they do what thet call a slim line refinance and the closing costs are a fraction of normal new loan closing costs. The last time, they actually gave us a credit towards closing.

As for your loan balance, on my first house, the loan started out at just under $130k. Refinanced twice and nobody ever said anything about our closing costs being higher because it was a smaller loan.

smerka · April 2017

When originally refinanced, there was a price (interest rate) break if the loan was over $150,000. Every time I check with B of A the closing costs are $2,500-$4,0000

jtmh2012 · April 2017

I just looked up our last one. Looks like we paid about $4300. But they just rolled that back into the loan amount, but then we saved the mortgage payments we weren't making plus all the checks they sent us and dropped them all on the mortgage. By the time we were done, the new mortgage balance was about $1000 below the old one, we shaved 5 years off the mortgage, and saved about $40k in interest.

For what it's worth, I've never been a big fan of BoA.

Doesn't hurt to have State Farm roll the numbers and see what it all looks like.

brij2006 · April 2017

State Farm is really trying to push their investment/banking side of things since the insurance side is getting less and less profitable. So it doesn't surprise me that they have a low closing cost right now to try and gain business.

It's just my personal opinion, but I like to keep my banking/investing and my insurance separate. I personally would rather use someone who specifically specializes in mortgages and fully knows the in's and out's of it without also juggling insurance, investments, other banking products, etc.

smerka · April 2017

Thanks for the tip on streamlined mortgages. I called BofA today and it would $2,500 for closing costs. State Farm winds up being $1,800 after the other costs (you can pick your own title company and appraiser).

short+sassy · April 2017

smerka said:

Thanks for the tip on streamlined mortgages. I called BofA today and it would $2,500 for closing costs. State Farm winds up being $1,800 after the other costs (you can pick your own title company and appraiser).

Really?!? GRRRR. I was really annoyed with the last house I financed. I was NOT allowed to choose. The bank chose based from their list of approved appraisers.

When it got back to me that the appraisal was going to be $600, I strongly protested. That is $100-$150 more than what most appraisers charge for a double in my area. I was given some b.s. line that it would be a "conflict of interest" for me to chose the appraisal company. And, on that same token, they're not "allowed" to pick another company...even from their own list of appraisers...once one has been assigned.

My personal home that I financed was "half" the same story. I was told I couldn't pick the appraisal company because it was a conflict of interest. But my loan officer was able to choose both the appraisal company (from the bank's list) and the specific inspector.

Hehe...he specifically picked a more "lenient appraiser", who would hopefully not bother turning on the lights if it was broad daylight. The electrical runs on the outside had been stolen for the copper. And, although my mortgager didn't think it would make a difference since it was a conventional loan, we didn't want to rock that boat with underwriting if we didn't have to. Thankfully, it never came up.

MommyLiberty5013 · April 2017

Hi. That's what I was thinking too - to keep loans separate from insurance. However, I wonder if State Farm ends up selling the mortgages anyways to a larger bank like Wells Fargo or BofA.

State Farm Mortgages?

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