FAQ

Straight-forward answers to common questions about mortgages.

About SELFi

Why use SELFi?

To save money and reach your financial goals sooner. We empower you to shop and compare wholesale interest rates. For refinances, you work with a SELFi Mortgage Coach who guides you through the refinance. For home purchase loans, we match you with a vetted independent mortgage broker. In addition to low wholesale rates, our broker partners have access to loan programs that big banks and lenders do not offer. 

This sounds too good to be true, can I trust SELFi?

SELFi is fully licensed corporation. Our NMLS ID is 1724835. We have taken bank-level security measures to keep your information safe. You can read real reviews on our site, Yelp, Google, or Facebook.

SELFi started because we believe banks and brokers charge too much on mortgage refinances and saw an opportunity to help homeowners save more money. In addition to helping homeowners refinance, we help purchase applicants get matched with a vetted mortgage broker. 

Is SELFi a direct lender?

No. For refinances, we broker your loan to wholesale lenders that compete for your business like Rocket Mortgage. For purchaes, we match you with a vetted independent mortgage broker that can shop your loan with a network of wholsale lenders, enabling you to obtain a lower interest rate and have access to more loan programs to qualify. 

How can SELFi save me an extra $53,629 on my refinance?

When compared to America’s largest lenders, SELFi is able to get consumers lower rates, all costs being equal. The result is an additional $53,629 in savings over the life of the loan.  This is additional savings, and does not include potential savings from refinancing.  The loan scenario we used to compare assumes a Conventional 30 year fixed loan, in the amount of $453,100, secured by owner-occupied, single family home, primary residence in the state of Florida. The loan assumes a credit score of 740 or higher. The interest rates reflect the average of the lowest rates available with pricing closest to zero points over the course of 1 week in June 2018. America’s largest lenders are defined as Quicken Loans, Bank of America, and Wells Fargo. The savings assumes equal monthly payment over the lifetime of the loan. It does not include compound interest. 

Does SELFi operate in my state?

Click here on our licensing page for our up-to-date list in the states we operate.

We are working on expanding into more states in the near future. Let us know if you want us to get licensed in your state at hello@SELFi.com

How is SELFi different than LendingTree and Bankrate?

 

Like other comparison sites, SELFi enables you to compare interest rates online. For mortgage refinances, unlike LendingTree or Bankrate, we broker your loan to wholesale lenders such as Rocket Mortgage. For home purchase loans, we match you with a vetted independent mortgage broker. Our broker network pays us an advertising fee for the introduction. Unlike LendingTree and Bankrate, we do not sell your information to more than one broker which avoids fielding 10+ calls from different lenders, that won’t stop calling. 

Rates and Pricing

What is the difference between interest rate and APR?
The interest rate is the cost you will pay each year to borrow the money, expressed as a percentage rate. It does not reflect fees or any other charges you may have to pay for the loan.

 

The APR represents the mortgage interest rate plus any charges.

What is a rate sheet?
A rate sheet is a list of interest rates for different programs and the corresponding pricing of each rate.  
What is Pricing?
Pricing means that every interest rate has an associated Points or Credits.
What are points and credits?
Paying points is when you choose to pay more in closing costs in return for a lower rate.  Points are represented as a percentage of your loan amount (1 point = 1%). You might choose to finance points into your existing mortgage in exchange for a lower than market interest rate.  This is to “buy-down”, or lower, your rate.

Conversely, credits can be applied towards the closing costs of the refinance.  Take enough credits, and all closing costs are covered. This is how you get a No-Cost Refinance.  Any remaining credits can be applied towards your new escrow account, prepaid interest, or even the unpaid principal balance.

How does SELFi determine my mortgage rate?
SELFi partners with a large network of lenders who give us access to their wholesale rates. We then use an algorithm to match your existing criteria — such as credit history and loan amount — to find the lender that offers the lowest rate at the lowest cost on the day that you apply.
What is the difference between a Wholesale rate sheet and Retail rate sheet?
Lenders produce two sets of rate sheets: Retail and Wholesale.  Retail rate sheets are used when working directly with the lender.  Wholesale rate sheets are provided to third party originators such as SELFi.  Wholesale rates have much better pricing.
Wouldn’t I get a lower rate working directly with one of the banks?
No. Banks and lenders quote you off their retail rates, whereas SELFi has access to wholesale rates. 
How are you able to offer a lower rate with my existing lender than what I was offered working directly with them?
If your current lender is part of SELFi network, you will get a lower rate using SELFi than working directly with your existing lender.  This is because your existing lender will provide us their wholesale rate sheet. If you work directly with your lender, they will quote you off their retail rate sheet.
Can I refinance my mortgage if I'm in forbearance?

Conventional: If you’re refinancing on a conventional/conforming loan, you are required to make 3 on-time payments on your existing mortgage coming out of forbearance before applying for a refinance application. V

VA: You can refinance your mortgage as long as you’ve met 212 day seasoning, 6 consecutive on-time payments before you went into forbearance, and you are currently out of forbearance. 

Loan Programs

How do you offer loan programs that my bank does not offer?

Our marketplace of lenders have different guidelines or requirements for getting a mortgage. We use an algorithm to match your goals to the lender guidelines and interest rates. This results in over 1000 loan programs, whereas your bank may only offer a handful of loan programs.

Which loan programs does SELFi specialize in?

SELFi specializes in and works with lenders that offer:

  1. JUMBO loan with low down payment
  2. Non-conforming loans for people who cannot qualify for a conventional loan.
  3. Conventional loans – cash-out, rate and term, purchase
  4. Homepossible and HomeReady
  5. FHA and VA
  6. Reverse Mortgages

If you are looking another loan program, let us know at hello@SELFi.com

You offer loan programs that banks do not. Isn't that what happened with the housing crisis?

Our marketplace of approved lenders each have their own guidelines, interest rates, and loan programs. Many lenders in our marketplace offer loan programs that traditional banks do not offer, whether it be a lower credit score or less down payment required. The lender makes their own determination based on the performance of these loans. Unlike the loans made leading up to the financial crisis, both SELFi and the lender verify that the borrower has the ability to repay the loan.

Is combining a 1st and 2nd mortgage a rate and term or cash-out refinance?

Combining a first and second mortgage, such as a home equity line of credit (HELOC), is considered a cash-out refinance unless the second mortgage was obtained at time of purchasing the home.

Can my new loan amount be lower than my unpaid principal balance?

When refinancing, your new loan amount is your choice. There are no limitations on how low your loan amount can be, only limitations on how high your loan amount can be. Generally, you cannot receive more than $2K cash-back without the refinance being considered a cash-out refinance. 

Locking

What exactly does locking mean?
Locking means your rate and pricing (the points or credits associated with your rate) will not change, even as the market changes. This gives you the peace of mind to complete your refinance, knowing that your rate and credits will not change, even if rates go up.
Can I pre-lock?

No. SELFi does not allow pre-locking. Pre-locking means you are locking in your rate before e-signing initial disclosures.

Can I choose a different rate or loan term after locking?
Yes. You can change your rate at any time. You may choose to do this to get more credit by moving to a higher rate or decide to pay more points for an even lower rate.
What if I need to break my lock?
You can back out of your refinance at any time without penalty or fee.
How quickly can I lock my loan?
We can usually lock your loan the same day or within 1 business day.
What if my rate lock expires before my loan is complete?
We will extend your rate lock if it expires before your loan closes. There is a lock extension fee that adds to the points or reduces credit. This is why it is important to complete items in a timely manner.

Fees and Closing Costs

Do you offer No-Cost refinances?
Yes. No-cost refinances are when you take a lender credit sufficient enough to cover all the fees. To get a “no-cost” refinance, you just have to select a lender credit sufficient enough to cover the fees.

Please note, that if your application requires an appraisal, that cost would have to be paid out-of-pocket prior to the loan closing.

How much will my closing costs be?
It depends. Your exact closing costs will be based on circumstances of your loan. For example, your loan amount, loan program, rate selected, etc.
When am I expected to pay for the appraisal?
Unlike most lenders, your loan is reviewed with an underwriter prior to paying for the appraisal. This way you know if you are conditionally approved.

After your loan is approved, you are required to pay for the appraisal. The cost is typically around $550 but can vary by county and property type.

When will I be expected to pay fees, if any?
With the exception of the appraisal, all fees are paid at closing either by being financed into your loan or paid out-of-pocket.
What are third-party fees?
Third party fees are costs associated with your refinance charged by a company other than the lender.

  1. Appraisal fee: If your loan program requires an appraisal, SELFi will check to see if you qualify for an appraisal waiver. If you do not receive a waiver, an appraisal must be completed to determine the value of your home. Payment of the appraisal is done prior to the loan closing. You will get a copy of the report.
  2. Credit report: We need to check your credit in order to determine as part of your loan application.
  3. Flood Certification: This is required to determine if your property is in a flood zone to ensure appropriate insurance coverage.

You can check today’s rates for a quick estimate of the third-party fees.

 

  1. Lenders Title Insurance: This fee ensures the lender is protected if someone later makes a claim against the title of your property.
  2. Recording: A fee charged by your county to officially record the mortgage.
  3. Escrow/Settlement: The fee paid to the escrow agent for coordinating the handling and disbursement of the funds from the lender.
  4. Transfer taxes (most states do not have for refinances): While most states do not have a transfer tax when refinancing, some states do such as Florida.
Is there a prepayment penalty if I refinance or sell my home?
No.
What are negative closing costs?

Negative closing costs are when the lender credit exceeds the loan costs. The excess lender credit can be applied towards non loan costs such as property taxes, prepaying interest, homeowners insurance, and even as a principal reduction. 

Are there any limitations to negative closing costs?

Yes. If a lower rate exists at the same closing costs then lenders will require you to choose the lower of two rates. For example, if 3.250% is $0.00 closing costs, but 3.190% is also $0.00 closing costs, the lenders will require you to choose the lower of the two rates. 

Escrow

What is included in the monthly payment?
When you get a rate quote on our site, the monthly payment shown includes the principal and interest of the loan. You will also need to pay taxes and insurance which will be escrowed.
What is an escrow account?
An escrow account, sometimes called an impound account, is an account managed by your mortgage servicer to pay property taxes and homeowners insurance.
Do I need to have an escrow account?
It depends on your loan program. An escrow account is mandatory for all FHA and VA mortgages. For Conventional mortgages, an escrow account is optional.
What happens to my existing escrow account?

Your current mortgage servicer will refund the balance of your escrow account after your loan closes. This typically happens within 3 weeks of closing. This video explains further. 

Why is the balance deposited into escrow more than my existing escrow balance?
Two reasons. First, when you refinance, you go one month without a mortgage payment, potentially two. Yet the taxes and homeowners insurance still need to be accounted during the month(s) without payment.

Second, you may be running an escrow shortage with your current servicer. An escrow shortage is the result of not having enough money in your escrow account to cover the actual amount needed to pay your bills.

Will my escrow increase in the future?
We don’t know. Your monthly escrow contribution changes as your property taxes and homeowners insurance change.  If your taxes go up, your escrow expense will go up.

Rates have nothing to do with your escrow payment.  We suggest you look at your mortgage payment in two parts – principal & interest, and escrow.  With a fixed rate, your principal & interest will never change. Your escrow will likely change annually.

Can I transfer my current escrow account?
No. Any balance in your current escrow account at the time of the new loan funded will be refunded to you by your current mortgage servicer. This typically happens within 3 weeks of closing.

Processing your Loan

After I apply online, what are the next steps?
You will receive an email with initial disclosures such as a Loan Estimate to review, which you can e-sign on your phone or computer.
Will I have a point of contact to guide me through the process?
Yes. A SELFi Mortgage Coach and processor will guide you through the loan process after you e-sign disclosures.

For most loan applications, the processor can expertly answer all your questions. If there are special circumstances regarding your loan application, a SELFi Mortgage Coach will contact you to review your loan and provide unbiased answers and advice.

What documents are required of me for my refinance?
It depends on your specific criteria and loan program. The assigned processor will inform which documents are required. Usually we will required:

  • Recent mortgage statement
  • Photo of drivers license
  • Homeowners insurance declaration page
  • Last two years W-2
  • Most recent three pay-stubs
  • Last two months bank statements
  • Owner’s title insurance (if you have it)
How quickly can I close my refinance?
Usually, around 30 days. The exact timing depends on a few factors, including how quickly you can submit required documents and e-sign initial disclosures.

If you have a second mortgage that needs to be subordinated that will add time to complete the refinance.

How will closing occur?
A notary will arrive at the place of your choosing, at a time convenient for you to sign closing documents. Your processor will schedule directly with you. A notary is usually available any day between 9am and 10pm.

After your refinance is completed

Will I get to skip any payments?
Yes and no. No payments are “skipped” however, we can structure the loan so that you can go at least one month without a payment, potentially two.

Click here for a complete answer on going two months without a payment.

How will my loan be serviced after closing?
A mortgage servicer is a company that collects your mortgage payments each month and provides statements. We collect third-party reviews to ensure your loan is being serviced with care.
How do I make my first payment?
After you loan closes you will receive instructions from the lender in writing with their welcome letter.
Will SELFi help me if there are concerns with the servicing of our loan in the future?
Yes, of course. The mission of SELFi is to help you achieve financial freedom faster. We are here for you long after you complete your refinance. Feel free to email us at hello@SELFi.com with a description of the issue and we will do what we can to help.
Will my property taxes change by refinancing?

No. Tax assessed values are only used by tax collectors.