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Possible for good payer to negotiate a low early morgage payoff?
10-24-2009, 07:55 PM
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#1
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Thinks s/he gets paid by the post
Join Date: Oct 2005
Posts: 2,203
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Possible for good payer to negotiate a low early morgage payoff?
I have about 10 years left on a 15 yr fixed 5.5 mortgage...75k left of 105 origianal. Mortgage is about 860 and I pay 1150/mo to CCO.
Is there a chance that they would negotiate an early cash payoff? I know it doesnt hurt to ask, but I'm curious as to the best approach. Tell em "hey, i just got a lump sum settlement and want to pay this off now" or" hey, i'm self employed, work sucks, and i have a family member willing to do this for me" etc etc
Any ideas, advice? ? I have excellent credit and never defaulted on any payment of any kind
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10-24-2009, 08:00 PM
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#2
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Posts: 2,487
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They'll certainly accept payoff of the full amount. If you can pay part of the amount but not the full amount, I doubt they would even talk to you. They'd rather let you pay the monthly for the next few years including the interest. I can't think of a reason they would accept settlement at a discount from a good payer. BTW, that is not an excuse to become a bad payer. If you fall behind and then suddenly have a chunk of money, they'll just want you to catch up.
R
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10-24-2009, 08:00 PM
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#3
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Moderator Emeritus
Join Date: Feb 2004
Location: minnesota
Posts: 13,228
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They don't want you to pay it back. What are they going to do with the money? I think the chance is about nil of negotiating a discount. They will try to nickle and dime you for every cent they can.
My guess.
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No more lawyer stuff, no more political stuff, so no more CYA
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10-24-2009, 08:02 PM
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#4
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2002
Location: Texas: No Country for Old Men
Posts: 50,004
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What Rambler and Martha said. Chances are zero of them accepting any early payoff less than the full amount due.
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Numbers is hard
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10-24-2009, 08:05 PM
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#5
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2005
Posts: 5,381
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It never hurts to ask, but why would any bank willingly take a loss on a performing loan to a customer with sterling credit?
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10-24-2009, 08:10 PM
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#6
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Thinks s/he gets paid by the post
Join Date: Oct 2005
Posts: 2,203
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that's what i figure, but i'm going to give it a shot.
wishful thinking, eh?
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10-24-2009, 08:17 PM
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#7
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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I've heard of this happening when borrowers have mortgages with rates several hundred basis points below the current market rate, but not otherwise. And we're not in an interest rate environment where that's likely.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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10-25-2009, 11:47 AM
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#8
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Administrator
Join Date: Jul 2005
Location: N. Yorkshire
Posts: 34,056
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Quote:
Originally Posted by thefed
that's what i figure, but i'm going to give it a shot.
wishful thinking, eh?
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Good luck, always worth asking but I can't see why the bank would want to give a discount (and lose money in the process) on an early pay off by a good customer.
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Retired in Jan, 2010 at 55, moved to England in May 2016
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10-26-2009, 07:43 AM
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#9
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Moderator
Join Date: Dec 2007
Location: Eastern WV Panhandle
Posts: 25,300
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Quote:
Originally Posted by Martha
They don't want you to pay it back. What are they going to do with the money? I think the chance is about nil of negotiating a discount. They will try to nickle and dime you for every cent they can.
My guess.
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Agreed. When DW and I paid off the old house the first piece of mail we got from the mortgage company was an offer for a new mortgage.
We recently applied for and got a new cc account to replace one that was going to charge annual fees and the loan officer seemed disappointed that we had no interest in a HELOC.
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When I was a kid I wanted to be older. This is not what I expected.
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10-26-2009, 08:19 AM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2007
Location: Independence
Posts: 7,281
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some years ago i came into a lump sum and told one one mortgage holder (private party) that I could pay off him or another note - if he would reduce the interest rate on his note I'd pay off the other one. He didn't want to reduce his rate, so I paid him off. He was not happy - as I told him, it seemed odd that I should apologize to him for paying him, so I wouldn't.
If you have a couple notes and it's true you might try for an interest reduction on one and pay off the other..
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10-26-2009, 02:26 PM
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#11
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Full time employment: Posting here.
Join Date: Sep 2007
Location: mpls, mn
Posts: 763
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Ther's no chance of getting a discount on your mortgage if you want to pay it off early. Check to make sure there isn't a penalty for paying it off early.
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10-26-2009, 02:48 PM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Oct 2005
Location: North Oregon Coast
Posts: 16,483
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Quote:
Originally Posted by mn54
Ther's no chance of getting a discount on your mortgage if you want to pay it off early. Check to make sure there isn't a penalty for paying it off early.
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Not in the current climate. Though in the early 1980s, when mortgage rates were in double digits, my parents did receive an offer from the lender to pay off their 4.5% mortgage at a discount.
Figuring the bank wouldn't offer unless it was to their advantage, they declined.
If mortgage rates suddenly spiked to 8% or more, I could potentially see lenders willing to give discounts to pay off 5% mortgages -- but again, that's nowhere near the current environment.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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10-27-2009, 09:10 AM
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#13
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Thinks s/he gets paid by the post
Join Date: Mar 2005
Posts: 2,594
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Skip a few payments ... trash your credit ... then they'll talk (especially if your self employed). Until then, they're happy with the monthly payments.
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FIRE'd since 2005
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10-28-2009, 08:46 PM
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#14
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Thinks s/he gets paid by the post
Join Date: Oct 2005
Posts: 2,203
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Quote:
Originally Posted by tryan
Skip a few payments ... trash your credit ... then they'll talk (especially if your self employed). Until then, they're happy with the monthly payments.
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yeah,aint that some sh$#
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10-29-2009, 11:59 AM
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#15
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gone traveling
Join Date: Oct 2009
Posts: 125
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Quote:
Originally Posted by ziggy29
Not in the current climate. Though in the early 1980s, when mortgage rates were in double digits, my parents did receive an offer from the lender to pay off their 4.5% mortgage at a discount.
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Of course the lender wanted them to payoff their old mortgage. And so long as the discount would comparable to that of a bond paying that interest rate, it would be a fair deal. Methinks that the lender did not want to give them such a great deal.
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