How To Refi Your Mortgage at 3.77% andNo Fees!

We’ve found what we believe to be the best deal out there on refinancing. It’s called the Union Bank FLEX Equity Line. What’s different about this equity line is that you can FIX the rate for 20 years on any or all of it. And if rates go down even further, you can do it again. For free!

So here’s how this works. You need to have equity in your home, because they won’t go higher than 70% loan to value. So for instance, imagine you have a mortgage now for $300K and a $100K equity line of credit just for emergencies. You can get a FLEX for $400K as a new first trust deed and get rid of the two loans you currently have. You fix the $300K at their going rate for 20 years fully amortized and use the $100K as a cushion for future emergencies. The fixed portion never changes. If you were to borrow the $100K at a later date you could also fix that at the going rate at the time, or let it float. The going rate today is 4.02% if you have a Union Bank account that they can automatically take the monthly payment from.

Now if you have $100K in a Union Bank account, you can get ¼% less, or 3.77% fixed for 20 years. We didn’t happen to have $100K in an account, so we snagged it from an equity line on one of our other properties, put it in Union Bank long enough to qualify for the ¼% break, and then returned it to the other equity line. It’s worth a few days interest to lock down a 3.77% fixed rate on our home mortgage!

By the way, this costs very little to set up, nothing at all like a typical refinance. There is no mortgage broker to pay, you just walk into Union Bank and do it.

Once you’ve fixed your mortgage, what if interest rates go down? Union Bank says that you can “re-fix” it once a year. So 12 months from now if interest rates are lower, you can fix it at the lower rate, no charge.

Now here’s a top secret advanced strategy. I know this works because we just did it. This was Crystal's brilliant idea. Union Bank says they know about this “loophole” but they don’t publicize it. So now you’re part of the inner circle. Here’s how it works: you have to have enough equity in your home to set up the FLEX line for TWICE what you need. So say that you need a mortgage for $200K and you can set up the FLEX line for $400K. What you have is a $200K fixed portion, and $200K of credit still available on the line. With me so far?

When interest rates drop, here’s what you do. You go into Union Bank and borrow the second half of your FLEX line, fix it at the new lower rate, and put the money in your checking account. Then you write a check and pay off the first half of the FLEX line. The end result is that you now have a $200K mortgage at the new lower rate, $200K credit still available, and you didn’t have to wait a year to do it.

Is this a great product or what? We were wondering, “what’s the catch?”, but we’ve had our FLEX line for several months now, and it works just like Union Bank said it would, with no catch. So if you’re in a position to take advantage of this, I recommend that you hustle over to your nearest Union Bank and set this up while rates are low!