Jump to content
Fantasy Football - Footballguys Forums

Mortgage Rates


MechEng

Recommended Posts

8 hours ago, Buckna said:

Baseline jumbo limit is 484,350 for 2019 and goes up to 510,400 for 2020. But it varies by county, if you live in an expensive area like San Fran jumbo limits are much higher for example (765,500)

Correct, for 2020 some big changes.

Conventional normal limit is being raised to $510,400. $765,500 for high cost areas. A couple of other limits for some counties in between. See here for specific county limits for conventional: https://www.fhfa.gov/DataTools/Tools/Pages/Conforming-Loan-Limits-Map.aspx

FHA low cost limit is being raised to $331,760 and high cost limit to $765,600. And then individual limits specific to county. See here for in between limits for FHA: https://www.housingwire.com/wp-content/uploads/2019/12/2020betweenfloorceiling.pdf 

New no limit for VA on 0% down. 

 

 

Link to comment
Share on other sites

On 8/19/2019 at 8:56 PM, Fruitbat said:

Anyone ever use BNC National Bank?  Getting one of my better offers from them via internet...I think from a Zillow form I filled out.

Closing the loop on this if anyone cares.  Went with them, process went fine.  Happy with new mortgage.

Link to comment
Share on other sites

Here is a perfect example of what I talk about here. I had in my LinkedIn feed a post from an LO at a large direct lender. It was advertising an extension of "no lender fees" for VA loans. Sounds great... right? Well, brokers offer that on a daily basis to everyone. It isn't special. Plus, this particular company gets blown out of the water on rates consistently by brokers. I hate to see consumers in general get taken advantage of but it really boils my blood how many lenders target veterans to take advantage of. 

Lies, more lies and marketing. 

Link to comment
Share on other sites

1 hour ago, Snickers said:

Went down to a 15-year loan recently, locked in a 3.0% and pretty pumped about it. Meeting with my financial advisor in January to see what it would take to pay off in 8 years as that is when my oldest goes off to college.

you can figure that out with any mortgage calculator.

  • Like 1
Link to comment
Share on other sites

2 hours ago, Snickers said:

Went down to a 15-year loan recently, locked in a 3.0% and pretty pumped about it. Meeting with my financial advisor in January to see what it would take to pay off in 8 years as that is when my oldest goes off to college.

 

1 hour ago, Getzlaf15 said:

you can figure that out with any mortgage calculator.

https://www.daveramsey.com/mortgage-payoff-calculator

  • Like 1
Link to comment
Share on other sites

8 hours ago, Snickers said:

Went down to a 15-year loan recently, locked in a 3.0% and pretty pumped about it. Meeting with my financial advisor in January to see what it would take to pay off in 8 years as that is when my oldest goes off to college.

That is pretty easy to figure out pkaying with an online mortgage calculator. 

What lender? 

Link to comment
Share on other sites

A guy I connected with down in Florida a bit ago who needed some direction on getting credit better to buy a home recently sent me a message letting me know that he bought his home. Which is awesome. I do enjoy helping people even when I have nothing to do with the outcome in any kind of monetary way. I had referred him to a broker down in Florida and asked if he used her and how it went. He let me know that he went with "another broker". Suspicious that it was not a broker (I have been around the block once or twice after all) I asked him what was the name of the company he used. He let me know he had a friend who knew a guy at Caliber so that is where went. Right away I knew he cost himself money from not using my referral. It is actually a bit of a good and bad news thing. The good news is that Caliber is actually a pretty good lender the does not have a reputation for ripping clients off. The bad news is that they have a wholesale division (wholesale being what brokers access to do loans) and that if he used my referral, he could have gone and got the exact same loan from the exact same company for less rate/cost. 

Now, some think that is crazy. Why would it cost me more to go straight to the lender versus using a 'middle man' like a broker. The reality is that you are going to get retail rates going straight to a lender, even one that a broker has access to than going to the broker who can get wholesale rates. It really is that simple. 

Here is an article I wrote a few months ago for anyone interested in getting more info on the difference between a mortgage broker and a mortgage banker. If you like it and are on Linkedin, I would appreciate you using the link to like the article. Best of luck everyone. 

 

https://www.linkedin.com/pulse/banker-broker-same-thing-right-chad-masters/

 

Quote

 

Banker and Broker- Same Thing, Right?

Published on July 17, 2019

When someone says that they are a Mortgage Banker and another says that they are a Mortgage Broker it is two people with different titles doing the same thing, right? Many people think this. I have found that even people who deal with real estate often like realtors are confused about what the difference is and use the titles interchangeably. This is not a case of semantics but rather it is an important concept to understand when you are preparing to buy a home loan or refinance an existing mortgage. I believe that once I explain the difference between a Mortgage Banker and a Mortgage Broker, you will see why it is crucial to know and will assist in guiding your choices as you decide whom to do business with.

Before we move forward I would like to note that in the mortgage industry there is not a duality of banker vs broker. Many different models can blur the lines and even some other models that are very different from being a broker or a banker. That being said, we will focus on the pure Mortgage Banker and a Mortgage Broker.

Simply put a Mortgage Banker is a loan officer that works for a bank or a non-bank mortgage lender. Their job is to sell the loans that their employer has to offer. In contrast, a Mortgage Broker is a loan originator that takes their clients loan application and uses their expertise and knowledge to shop multiple lenders. They are first looking for the best opportunity to get the client approved and then if multiple lenders will, which lender will offer the best rates, cost, fastest turn times and most reliable service. The broker then processes that loan in partnership with the chosen lender to complete the loan process to purchase or refinance.

A big difference, to begin with, is how someone becomes a Banker or a Broker. A Banker is qualified for the position by being hired by the bank and receiving an NMLS number. It is up to the individual bank to ensure the person is competent and knowledgeable. NMLS is required of all lenders working to originate loans (both Bankers and Brokers) that are secured by residential real estate. An NMLS certification requires a background and credit check. For a Broker, it is a much harder process. They must get personally licensed in each state that they are working in (they can get licensed in multiple states but must go through the licensing process for each state). To get a license they must complete 20 hours worth of class and pass a state-issued exam. If they are starting their brokerage as an owner, they must also establish the brokerage itself with has its own licensing requirements. The Broker must pass another background check and credit check.

A Mortgage Bankers' job is to sell you the home loan options that their employer has to offer. They are limited to the choices that their company has for a mortgage and if you are a square and all they have are circles, they will try to fit you into a circle (or perhaps convince you that you are a square) because if not then they lose the sale and most of the time that means a smaller paycheck for them. For a Mortgage Broker, their job is not to sell a loan but rather to place the loan with the best lender who fits the client's particular situation and goals. A Broker takes the application and collects the related documents. Working with multiple lenders, they use their experience, knowledge, and expertise to figure out which lender is the best option for the client. This first starts off the question of who will approve this loan? The question may arise of which loan program is best when several options may exist. That is where the Broker works with the client to find the square that is a perfect fit for your square needs and wants. If several lenders will then the next question is who will offer the best mix of rate, cost, speed to process and reliability to perform as expected? The Broker will then work in partnership with that lender to process the loan and have it ready to close for the purchase or refinance.

As mentioned above, a Banker is limited to whatever options their bank offers. Some banks are better than others but even the best of the best of banks will never have as many options as a Broker. Further, most banks are extremely conservative in their underwriting. When dealing with conventional and even government-backed loans like VA, FHA, and USDA they will often have overlays. An overlay is a rule or guideline that goes beyond what the minimum requirements are of the loans to qualify. Brokers often have access to lenders with minimal or no overlays. Even beyond that, Brokers often work with lenders who specialize in doing loans that are not part of the everyday loan box that a Banker is in. This means that depending on the Broker they may be able to do loans with very low credit scores and recent bankruptcies or foreclosures. Clients with particular needs like ITIN's will often not find a bank who will help but a Broker may. Business owners or 1099 contractors that take advantage of the tax code and write off much of their income and thus can not show their true income, a Broker can use their bank statements to show the income. Brokers simply work with more options and thus can provide more options to their clients than a Banker could.

For a Banker, when it comes to rates they are often limited by the general rates and cost that their bank has determined is what they are going to charge. 77% of home loan consumers do not shop for a mortgage. Retail lenders (Banks and non-bank lenders) know this and take advantage of it. They also need to pay for a tremendous amount of overhead. The loan officer needs to be paid, the loan officers boss and their boss and on up to the CEO. Plus the CEO needs his bonus for that 4th summer home and to do that the shareholders must get paid. That is all after paying for the bank branch and everything else as well. When it comes to rates and charges on a home loan, a Broker accesses wholesale rates. As opposed to the retail organization that can bet that the consumer will not shop for a better deal, wholesalers know that 100% of their loans are being shopped. If they are not competitive in offering rates and costs then they will not get the business from the Brokers. This creates very healthy competition for the consumer that ends in their best interest. Further, the Broker has very little costs associated and not as many mouths to feed. All of those savings are passed to the consumer in the form of lower interest rates and lower costs for the home loan.

Time is an important factor when you are buying a home. As the buyer, once you sign that contract you are obligated to be ready to close on the home. To close, you need your loan ready to close. This is yet another area where Bankers and Brokers tend to be different. Of course, it depends on the bank but many bankers will close loans in 25-45 days. The Banker has no choice of whom to send the loan to for processing. They are stuck with their bank. If the bank is performing well, great. If not, then the consumer suffers. Brokers, since they can choose whom they send a loan, they will often only send loans to wholesalers that have shown they can be ready to close loans quickly. Brokers often talk to one another and if a particular wholesaler is underperforming they will shift their business to other lenders in the best interests of their client. Brokers often have most of their loans close within 2-3 weeks. Some deals can be ready to close in a little over a week!

Whether Banker or Broker, both are only human. And they work with other humans. So, mistakes will happen. But what is the difference when a mistake happens? For a Banker, there is a limited amount of choices. They can appeal to a higher level of management within the bank to make the situation better and hope they decide to act. After that, the Banker is out of choices. For a Broker, they can work with the lender that the loan is currently at. However, if there is an option of taking the loan to another wholesaler then that is very much an option. But before a mistake happens, a Broker can limit the possibility of mistakes happening by sending loans to wholesalers who have proven themselves to be reliable. Once more, a Banker has no choice. They just have to hope their back-office team with the bank is on their game.

There is an old saying that describes someone who does not work a lot of hours. That saying is someone has "Bankers hours" and though this has changed much from the past when the saying originated it is still a difference between Bankers and Brokers today. Of course, this can vary with individual Bankers and Brokers but in general, Bankers are available during regular business hours and perhaps some Saturday hours. As a Broker, I have personally answered the phone, a text or email in the early morning, late evening, through the weekend and even on holidays. I often tell my clients that I don't have set hours that I work. If I am available then I will answer and if not then I will get back to them as soon as I can. I set appointments around my client's ability and not them around my own. I will say that I know plenty of Bankers who will do the same but in general, Brokers are much more available than Bankers.

Of course, there is competition between Banker and Brokers to get the business of clients looking for a home loan. You may be wondering at this point, why would anyone use a bank for a mortgage? There are many reasons for this. Here are the top 6 reasons in my view:

People do not know the difference between a Banker and a Broker. If you did not know there was a difference then why would you worry about which to pick? Hence, the reason for this article.

Brokers nearly went extinct after the Great Recession. There were a lot of bad Brokers working pre-2008. Many did not do business the right way and we're looking for the quick buck. When the easy money was gone, they were gone as well. Then regulatory changes were made that further forced any of the remaining bad ones out as they could not do business the way they did before. Brokers have experienced a rebirth of sorts recently and are growing. Bankers have moved to be Brokers because they see the advantages and consumers are becoming more aware of the advantages to them as well. The Broker channel now accounts for almost 15% of the mortgages done in this country.

A bad reputation. To be very honest it was earned. It was not unheard of for a Broker to take advantage of a borrower before 2008. At this time, I was a Banker and I cautioned my clients to only use a Broker if they knew what they were doing. Even as a Banker and working for a bank with employee discounts on the mortgage, I used a Broker to buy my home as I knew I was capable of keeping them honest. After some major regulatory changes and the purging of bad Brokers, the abuses that took place before are not possible now.

Not knowing what to do. Many consumers do not know much more than they want to buy a home or need to refinance. Often they assume going to their bank will be the best option. After all, they are already a customer, of course, the bank will give them a great deal. They go and talk to their bank, get their pre-approval and move forward.

Referrals from sources that may not be neutral. It is against the law for someone to refer another person to a loan officer and get paid on that referral. That being said, anyone can refer anyone to anybody. Often a borrower will get referred to a lender from their realtor. Your realtor is a trusted person and they know the business so they must have a good idea of what is best for me, right? Hopefully so but not always. Some lenders, often Bankers with marketing budgets, will pay for realtors marketing costs. This is legal up to half of the costs but this, in turn, creates an obligation on behalf of the realtor to send their clients to the lender who is helping pay for things for them (in a around way get paid for the referrals). A Broker could do this just as much as a Banker but typically it is Bankers who do this as a way to create referral sources since otherwise, they have very little advantages over a Broker.

Lot's of money in advertising. Banks and non-bank lenders often have huge marketing budgets that they spend heavily on TV, print, radio, and social media ads. According to Kantar Media from March 1 through May 21 of 2018, the current largest lender in the nation spent $57.3 million on network, cable, syndicated and spot TV ads. Brokers do not spend money like that. I know many who do not spend any money on marketing at all and rely on referrals from professionals who trust them and past clients who love them.

There also some myths or misunderstandings of what a Broker does and how they do it. I have heard some people mention these to me as reasons to not choose a Broker and I have heard Bankers push some of these myths as well. The top 5 of these being:

Bankers have in house underwriting and thus have more control. This is silly. I have never known a loan officer to have control over an underwriter. Most of the time the underwriter does not have control either, they have to follow the guidelines for conventional and government-backed loans and most often have tougher underwriting that the minimum required. If a loan officer ever did have control then the underwriter is not doing their job. And in fact, this is yet another area a Broker has the advantage over a Banker. The Banker has no choice of who does the underwriting. As discussed before, if a Broker has an issue with an underwriter, they have the opportunity to move the loan to a new lender with a new underwriter.

Brokers have no control over the appraisal. This is true. But it is also true of the Banker. There are some strict regulations now in place that have separated the lender from influencing the appraiser. The only thing that can be done would be to point out errors or missed information. This is a limitation of both the Banker and Broker.

Brokers are middlemen and you end up paying more. The reality is that by using a Broker who is accessing the wholesale channel (which is an extremely competitive marketplace) and getting wholesale rates/cost while not having to pay for all the overhead of a bank, you are most often paying more with the bank.

Brokers charge points and/or extra fees, that is how they get paid. This is again not accurate. Though a Broker can charge points, just like a Banker, in most cases it would be to pay down the rate (pay points now to get a lower rate on the mortgage). Most transactions for a Broker are "Lender Paid Compensation" which means that the wholesale lender is paying the Broker their commission which is already baked into the rate given. In some instances, Brokers do have the ability to do "Borrower Paid Compensation" which at that point the borrower does pay the Brokers commission. There can be several reasons for doing this which can get a little technical, but the Broker normally will do this to lower the rate and take less commission.

The bank has all your information so it will be easier. I must confess, I heard customers say this to me when I worked at banks and I never really bothered to correct them. I would just inform them that there would be some documentation I would need. Sure, I didn't have to ask for the social security number or address but the only thing that I could provide for them was the bank statements. For most people, getting a couple of months worth of bank statements takes about 2 minutes. Is it worth tens and perhaps hundreds of thousands of dollars of extra interest and costs? I am thinking it is not.

If you have stuck with me and read to this point chances are that I have won you over. With just a little information it is blatant that not only is there a very big difference between a Banker and a Broker but that the Broker is the preferred solution for most consumers. Likely anyone that would say otherwise has an agenda other than helping clients. Sure, there are exceptions as banks can have some great programs but for the vast majority of consumers out there if they did not talk to both their bank and a local Broker then they lost out on significant savings. The good news is that you can always refinance or choose a Broker for your next purchase. A Mortgage Banker and a Mortgage Broker are not the same and in the end #brokersarebetter

 

 

  • Like 2
Link to comment
Share on other sites

On 12/19/2019 at 8:30 PM, Chadstroma said:

That is pretty easy to figure out pkaying with an online mortgage calculator. 

What lender? 

In the process of getting a re-fi completed over the next week. 15 year, 3.12% rate (currently have a 30 year conventional at 5.3% and a 2nd loan at 8.47%).

Link to comment
Share on other sites

10 minutes ago, cubd8 said:

In the process of getting a re-fi completed over the next week. 15 year, 3.12% rate (currently have a 30 year conventional at 5.3% and a 2nd loan at 8.47%).

That is a good rate but rate isn't the only factor in a loan. You want to look at total cost. Easiest way to do that is the APR. 

Who is the lender? 

Link to comment
Share on other sites

30 minutes ago, Chadstroma said:

That is a good rate but rate isn't the only factor in a loan. You want to look at total cost. Easiest way to do that is the APR. 

Who is the lender? 

Going through a broker (Blue Leaf Lending); they say the mortgage itself will eventually be sold to Chase or Wells.

This made sense to me to do because my 2nd loan was a balloon payment; also, even staying in my current loans would have taken me about 18 years to pay it off, I'll do it in 15 now (paying down more principal vs. interest).

Link to comment
Share on other sites

1 hour ago, cubd8 said:

Going through a broker (Blue Leaf Lending); they say the mortgage itself will eventually be sold to Chase or Wells.

This made sense to me to do because my 2nd loan was a balloon payment; also, even staying in my current loans would have taken me about 18 years to pay it off, I'll do it in 15 now (paying down more principal vs. interest).

Unfamiliar with them but not a broker. Chase and Wells do not have wholesale divisions (anymore) which means it is likely a bank that often sells its servicing to them. I am unaware of any wholesaler that sells servicing to them. 

That makes me more suspicious that there is an absorbent amount of fees/charges. 

If you want, send me the Loan Estimate and I will review and let you know if I think it is good or if you could do better. Takes me a minute to do it so no biggie. There is no sensitive info on the LE as they are meant to be viewed but you can feel free to scratch out your identifying info like name and address. If you look good, I will let you know. If it looks like you can do better then I can connect you to a broker who you can compare with (assuming you are not in Illinois, otherwise I could help). Up to you. 

Shoot it over to cmasters@marketplacemortgage.com 

Link to comment
Share on other sites

Congratulations NREC34, 

You're prequalified for a Chase mortgage at 3.645% APR. That means you have the opportunity to save $134 every month and $1,608 annually by refinancing.

YOUR POTENTIAL SAVINGS

CurrentAfter Refinance

Loan Amount

$68,000

$68,000

Loan Term

149

180

Rate

5.125%

3.645% APR

Estimated Monthly Payment$620$486

APR shown is estimated as of 12/17/19, and may vary as rates can change daily. APR shown does not include other finance charges you may be required to pay. This rate includes the customer paying approximately 1 point at closing, which is generally 1% of the loan amount. Your actual rate, payment and costs could be higher. Get an official Loan Estimate before choosing a loan.

We've checked your credit to make sure you meet our initial criteria and prequalify you for this offer. Here are the next steps in getting approved for a new mortgage:

•Contact us to complete an application

•Provide information to verify that you meet our income requirements and other credit criteria

•We'll have your property appraised to make sure it supports your loan amount

Plus, because we know you, we can streamline your home loan process through digital verification using your current Chase deposit and asset accounts.

——————————————————

 

what do you guys think of this email I received???

I’m current paying 4.75 (67K) and have a HELOC at variable rate. Right now 4.64 (37K). 

Link to comment
Share on other sites

8 hours ago, NREC34 said:

Congratulations NREC34, 

You're prequalified for a Chase mortgage at 3.645% APR. That means you have the opportunity to save $134 every month and $1,608 annually by refinancing.

YOUR POTENTIAL SAVINGS

CurrentAfter Refinance

Loan Amount

$68,000

$68,000

Loan Term

149

180

Rate

5.125%

3.645% APR

Estimated Monthly Payment$620$486

APR shown is estimated as of 12/17/19, and may vary as rates can change daily. APR shown does not include other finance charges you may be required to pay. This rate includes the customer paying approximately 1 point at closing, which is generally 1% of the loan amount. Your actual rate, payment and costs could be higher. Get an official Loan Estimate before choosing a loan.

We've checked your credit to make sure you meet our initial criteria and prequalify you for this offer. Here are the next steps in getting approved for a new mortgage:

•Contact us to complete an application

•Provide information to verify that you meet our income requirements and other credit criteria

•We'll have your property appraised to make sure it supports your loan amount

Plus, because we know you, we can streamline your home loan process through digital verification using your current Chase deposit and asset accounts.

——————————————————

 

what do you guys think of this email I received???

I’m current paying 4.75 (67K) and have a HELOC at variable rate. Right now 4.64 (37K). 

You can most likely get better a better rate with a broker. I say most likely not knowing all the specifics that affect rate. You can also get a custom term with some wholesalers too if you wanted to. 

Doesn't look like a horrible offer though. Better than what I would expecr from Chase.

Link to comment
Share on other sites

52 minutes ago, Chadstroma said:

You can most likely get better a better rate with a broker. I say most likely not knowing all the specifics that affect rate. You can also get a custom term with some wholesalers too if you wanted to. 

Doesn't look like a horrible offer though. Better than what I would expecr from Chase.

Right. I DMed you awhile back and you don’t know any brokers in my state. 

Link to comment
Share on other sites

On 12/27/2019 at 11:26 AM, NREC34 said:

Right. I DMed you awhile back and you don’t know any brokers in my state. 

Someone I know gave me info of a broker in your state. I have not talked to them or know them so I can't personally endorse them. I sent their website address over to you in PM. 

Good luck

Link to comment
Share on other sites

12 minutes ago, Chadstroma said:

Someone I know gave me info of a broker in your state. I have not talked to them or know them so I can't personally endorse them. I sent their website address over to you in PM. 

Good luck

Thank you!!! That’s better than nothing. 

  • Like 1
Link to comment
Share on other sites

@Chadstroma let me know if/ when there are mortgages out there worth going after to replace the 3.25%, 30 year. Don't care if it's VA although that's probably easiest. No desire to go 15 unless it's a huge savings (could, but like investing more)

Link to comment
Share on other sites

I purchased a second home 30 year 4.125.  Sold my primary home and want to refinance the second as my primary home, looking for a 30 year, but don’t  see the value at current rates, any thoughts on doing this

Link to comment
Share on other sites

16 hours ago, -OZ- said:

@Chadstroma let me know if/ when there are mortgages out there worth going after to replace the 3.25%, 30 year. Don't care if it's VA although that's probably easiest. No desire to go 15 unless it's a huge savings (could, but like investing more)

I am right there with you now myself on conventional. Conventional you have a ways to wait on 30 yr. 

VA wise you are not too far off. A good dip in rates and you would be in consideration. I looked up a VA loan the other day and was around that rate with a small credit for great credit and a bit over 80% LTV. 

FHA is also in the neighborhood. (Just informational for others, you wouldn't want to go FHA if you have access to a VA). 

Rate wise, we may see things go up based on the "mini deals" with China and if that culminates in a big deal rates will certainly jump up assuming no other major events. However, we are due for a recession. If we do get into one in the near future there is a decent possibility to have all time lows on rates. 

 

  • Like 1
Link to comment
Share on other sites

15 hours ago, Gopher State said:

I purchased a second home 30 year 4.125.  Sold my primary home and want to refinance the second as my primary home, looking for a 30 year, but don’t  see the value at current rates, any thoughts on doing this

First. You did move into this home, right? Sounds like it but just making sure. 

If you have PMI on that home and now have the equity, the refi getting a slightly lower rate but dropping PMI on top could make sense.

Otherwise the other route to go is to see how much lower you can get the rate while covering the cost on credits. A drop at all with no cost to you is a win no matter how small the drop on rate. Then you can hedge your bet and if rates drop refi again and if they go up you got a little better out of it. 

Link to comment
Share on other sites

28 minutes ago, Chadstroma said:

I am right there with you now myself on conventional. Conventional you have a ways to wait on 30 yr. 

VA wise you are not too far off. A good dip in rates and you would be in consideration. I looked up a VA loan the other day and was around that rate with a small credit for great credit and a bit over 80% LTV. 

FHA is also in the neighborhood. (Just informational for others, you wouldn't want to go FHA if you have access to a VA). 

Rate wise, we may see things go up based on the "mini deals" with China and if that culminates in a big deal rates will certainly jump up assuming no other major events. However, we are due for a recession. If we do get into one in the near future there is a decent possibility to have all time lows on rates. 

 

If we hit a legit recession where rates and prices fall, the wife and I may change our minds about waiting a decade to buy the lake house. 

Understand we couldn't get a VA loan on the 2nd home. Would conventional be the way to go? Would it be smart to refi the home in a VA loan, and use cash out for a down payment on the 2nd home? 

I'd research the rules first, just thinking out loud for now. 

Edited by -OZ-
Link to comment
Share on other sites

9 minutes ago, -OZ- said:

If we hit a legit recession where rates and prices fall, the wife and I may change our minds about waiting a decade to buy the lake house. 

Understand we couldn't get a VA loan on the 2nd home. Would conventional be the way to go? Would it be smart to refi the home in a VA loan, and use cash out for a down payment on the 2nd home? 

I'd research the rules first, just thinking out loud for now. 

First thing to note. Recessions do not mean lower property values per se. If you look at the last 5 recessions previous to our last one (which is a bit of an outlier considering the recession was caused by real estate) you will see property values overall increased in 4 of the last 5 recessions. Obviously real estate being local but reviewing national averages that is what you will see. The reason is quite simple: rates are pushed down in recessions which increases liquidity and buying power. 

I would likely look at doing an IRRRL VA refi on the current property and save a few hundred on no appraisal and easier processing and then lool at buying with conventional for the second property if/when the time comes. 

So, yes, I think you are thinking along the right pathway forward there.

Link to comment
Share on other sites

2 hours ago, Chadstroma said:

First thing to note. Recessions do not mean lower property values per se. If you look at the last 5 recessions previous to our last one (which is a bit of an outlier considering the recession was caused by real estate) you will see property values overall increased in 4 of the last 5 recessions. Obviously real estate being local but reviewing national averages that is what you will see. The reason is quite simple: rates are pushed down in recessions which increases liquidity and buying power. 

I would likely look at doing an IRRRL VA refi on the current property and save a few hundred on no appraisal and easier processing and then lool at buying with conventional for the second property if/when the time comes. 

So, yes, I think you are thinking along the right pathway forward there.

I realize that's the case overall. Am I wrong in assuming lake / vacation houses could be good values in a recession?

If not a recession, what causes vacation type properties to depreciate? (Other than damage)

  • Like 1
Link to comment
Share on other sites

1 hour ago, -OZ- said:

I realize that's the case overall. Am I wrong in assuming lake / vacation houses could be good values in a recession?

If not a recession, what causes vacation type properties to depreciate? (Other than damage)

Of course real estate is all local but if you were looking in a resort type area where a high percentage of the properties are second/vacation homes then there would be a decent chance of property values declining for sure. 

  • Thanks 1
Link to comment
Share on other sites

On 12/29/2019 at 11:42 AM, Chadstroma said:

First. You did move into this home, right? Sounds like it but just making sure. 

If you have PMI on that home and now have the equity, the refi getting a slightly lower rate but dropping PMI on top could make sense.

Otherwise the other route to go is to see how much lower you can get the rate while covering the cost on credits. A drop at all with no cost to you is a win no matter how small the drop on rate. Then you can hedge your bet and if rates drop refi again and if they go up you got a little better out of it. 

Thanks.  I put 20 percent down so no pmi.  We did move in so we are living here.  Maybe I look at a 15 year and put more cash down.

Link to comment
Share on other sites

Was looking to refi.  I have Mortgage Insurance from when I bought our house 3.5 years ago.  My interest rate is 3.375.  There is now enough equity in the house that if I refi, I could get rid of the Mortgage Insurance.   (233k on the note and home value is probably just above 300k).  Currently, I'm paying 1110 in Principle/Interest and then Taxes/Ins of 407 and then Mortgage Ins of 162.  Seems like a no brainer to refi and have that 162 go toward Principle right? 

I assume it's worth it to have a higher rate if overall I'm spending less per month?  

and as chadstroma suggested I think I may look into a broker in the S. Florida area.  If anyone has any recommendations on a broker, I'd appreciate it - otherwise, I'll just use the google machine.

Link to comment
Share on other sites

24 minutes ago, blend said:

Was looking to refi.  I have Mortgage Insurance from when I bought our house 3.5 years ago.  My interest rate is 3.375.  There is now enough equity in the house that if I refi, I could get rid of the Mortgage Insurance.   (233k on the note and home value is probably just above 300k).  Currently, I'm paying 1110 in Principle/Interest and then Taxes/Ins of 407 and then Mortgage Ins of 162.  Seems like a no brainer to refi and have that 162 go toward Principle right? 

I assume it's worth it to have a higher rate if overall I'm spending less per month?  

and as chadstroma suggested I think I may look into a broker in the S. Florida area.  If anyone has any recommendations on a broker, I'd appreciate it - otherwise, I'll just use the google machine.

Have you called you bank (where the mortgage is at)?  If your loan isn’t FHA you may be able to drop the PMI without a refi (appraisal would be required).

 

Link to comment
Share on other sites

6 hours ago, blend said:

Was looking to refi.  I have Mortgage Insurance from when I bought our house 3.5 years ago.  My interest rate is 3.375.  There is now enough equity in the house that if I refi, I could get rid of the Mortgage Insurance.   (233k on the note and home value is probably just above 300k).  Currently, I'm paying 1110 in Principle/Interest and then Taxes/Ins of 407 and then Mortgage Ins of 162.  Seems like a no brainer to refi and have that 162 go toward Principle right? 

I assume it's worth it to have a higher rate if overall I'm spending less per month?  

and as chadstroma suggested I think I may look into a broker in the S. Florida area.  If anyone has any recommendations on a broker, I'd appreciate it - otherwise, I'll just use the google machine.

PM me, I can connect you to a broker in Florida. Several options depending on where you are. 

For everyone, I personally know brokers all over the country and if it is the rare case I don't, I can find one for you. No, I don't get anything out of it doing this. I would not risk my license (it against RESPA regulations for me to get anything of value for referring a loan to another broker). But happy to help and connect anyone who wants with a broker. Benefits you. Benefits a fellow broker. Only ones that lose are banks and retail lenders that suck and over charge. 

  • Like 1
Link to comment
Share on other sites

It looks like things with Iran are heading towards calming down. Rates have responded edging back up. There is suppose to be a phase one trade agreement signed with the Chinese. This should all mean that rates will be heading up in the near term. If you were waiting for someone or are floating on a loan application, I think now is a good time to get your app in and lock in. I will be recommending to my clients who are floating currently to do the same. 

  • Like 1
Link to comment
Share on other sites

On 1/7/2020 at 11:09 AM, blend said:

Yeah, I did call them.  I'm not able to drop the PMI.  

That sucks. I haven’t had PMI in many years but the first house I bought (some 20 years ago) appreciating really fast and an appraisal got it removed.

Link to comment
Share on other sites

  • 2 weeks later...

Someone posted a link in here a few months back where you could search local mortageg companies or something like that. Can't find it now. 

We bought in May 15 year fixed at 3.6.  Called today to see if we could get it lower with a refi and was quoted 3.1 in a 15 year. Should we shop around and try to get below 3?

Link to comment
Share on other sites

12 minutes ago, flapgreen said:

Called a local company and got 2.9.  Looks like we're refinancing 9 months after closing on the home. 

Ugh I bought last May and my stupid rate is 4.375. I wish i can refinance not sure it's worth it with this stupid NY mortgage tax I'd have to pay again. Frigging bunch of con artists we have here. 

Link to comment
Share on other sites

56 minutes ago, shadyridr said:

Ugh I bought last May and my stupid rate is 4.375. I wish i can refinance not sure it's worth it with this stupid NY mortgage tax I'd have to pay again. Frigging bunch of con artists we have here. 

Costing us 2500 to refinance in Tennessee. No complaints 

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Recently Browsing   0 members

    No registered users viewing this page.

×
  • Create New...