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poofactory posted:I made an all cash offer of $950k (no contingencies, close in 30 days) on a short sale and was told by the agent that I was outbid. It closed two months later significantly under my offer (more than $25k). Next offer I put in I'm having my agent tell the other agent that I will be calling the lender to make sure my offer is accepted for evaluation. And it won't be a bluff.
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Aug 18, 2011 18:42
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sanchez posted:We're being offered a refinance at 4.5% by the broker that did the original loan, which seems high compared to the rates that are flying around here. Is there anything that controls those rates beyond lender and zip code? Pricing adjustments to rate can depend on a large number of factors. Loan amount, loan to value, credit score, rate/term refi vs cashout, occupancy, property type (condos and multi unit get shafted), interest only vs fully amortized, subordinate financing, and loan term are all things that are considered by Fannie Mae. Your bank may also adjust for things such as the state the property is in, your debt to income ratio, and really anything else that could conceivably make your loan more or less risky. Freddie generally has similar adjustments. FHA is a bit different, but the same types of factors can influence your rate as well as the monthly mortgage insurance that is included. The rate that you're quoted can also depend on the business channel your loan officer is operating through. Generally speaking, retail branches (walk into Chase branch, get a Chase loan) are going to offer less competitive rates than mortgage brokers and correspondents. Additionally, you can generally take a higher rate to increase the pricing on your loan to help cover your prepaids and closing costs - this is how you get the "no cost" refis. If you want to see a big confusing chart on what factors influence Fannie's pricing, feel free to take a look at https://www.efanniemae.com/sf/refmaterials/llpa/pdf/llpamatrix.pdf . Your lender can of course tack on stuff on top of this if they want. Freddie's adjustors are generally similar. If there's any interest in it, I can write up a bigger post going over the interest rate/secondary market sale process or just general stuff about the mortgage approval process. I'm a conventional mortgage underwriter with a bit of knowledge about the other aspects of the loan transaction, from the bank side at least. I won't go super in depth about guidelines and scenarios since that poo poo you should really go over with a loan officer to get a complete picture of your loan situation, but I can shed some light on the process and tips on what to do/not to do to ease the approval process. (Here's a hint: don't retire 2 days before your loan is set to fund)
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Aug 18, 2011 19:08
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archangelwar posted:I know it may not feel like it, but your combined income puts you in the top 3%-4% of US households. I believe you mentioned something about saving roughly 40% of your net monthly earnings. This is not something the vast majority of the Americans are capable of doing, no matter how frugal they are. I am not saying this to inflate your ego, or for any other reason than to show you that you have opportunity that is simply not available to the average American, and it is up to you whether you capitalize on it or not. I wouldn't necessarily look for a financial advisor while making even $250k. The basics that apply for everyone else still applies, and they haven't shown they've gotten a grip on the basics besides "save something!" which should be retardedly easy at their income range. Until you get to an income where you can't follow the usual advice I'd advocate sticking with the same thing as everyone else like low-cost index funds, 401k maxing, Roth IRAs, etc.
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Aug 18, 2011 19:13
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necrobobsledder posted:But in terms of net worth they're not anywhere near the top 5% of households, which to me at their sort of income could be precarious. I have more than double their retirement but my wife's debts and constant (and expensive) emergencies make us a household at nearly $200k income and negative in total net worth. So I consider myself to be in a plausibly dire financial situation despite the income and existing assets. You are correct, they are not in the top 5% of asset owners because they are young and they are the early point of asset accumulation. However, they have a well stocked emergency fund and the beginnings of retirement savings, which does put them in a very small minority of Americans. They have the basics, and now it is time for them to start building upward. quote:I wouldn't necessarily look for a financial advisor while making even $250k. The basics that apply for everyone else still applies, and they haven't shown they've gotten a grip on the basics besides "save something!" which should be retardedly easy at their income range. Until you get to an income where you can't follow the usual advice I'd advocate sticking with the same thing as everyone else like low-cost index funds, 401k maxing, Roth IRAs, etc. Roth IRA is currently not an option for them, and assuming they are smart( unless the cap is completely removed at some point) their income will continue to rise above the contribution limit. Their savings rate exceeds the maximum 401k contribution limit as well, and 401ks are not necessarily the most efficient way to grow wealth for people with high disposable income, especially if the fund selection offered by their provider is poor. They are in the luxury position of being able to both fully fund traditional retirement options and have money left over. Unless I am missing something, there are no indications that they need to be conservative with their wealth building options at this point, especially given that they have seemingly wealthy family as well as external liquid assets available. Edit: And I am not suggesting that they get some sort of estate manager. Sitting down with a financial adviser who can look at your income and determine the best way to split your investments is not a waste of time for anyone who has disposable income. archangelwar fucked around with this message at 19:58 on Aug 18, 2011 |
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Aug 18, 2011 19:53
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sanchez posted:We're being offered a refinance at 4.5% by the broker that did the original loan, which seems high compared to the rates that are flying around here. Is there anything that controls those rates beyond lender and zip code? Equity plays a small part in mortgage pricing, DTI and most other factors just matter as far as approval goes. The rate of the loan is independent of the interest rate for the most part. You're broker is loving with you. He could get you a loan at 4.25. He's probably offering you a 4.5 rate with no points/costs. His commission would cover the refi fees and leave a nice chunk of change in his pocket. My family used to be in the mortgage broker business before the 2008 bust. Here's how brokers work and how they make their money. Say you want at 200K mortgage, and have 'A paper' (credit scores about 720, great job history). A mortgage broker gets a rate sheet from lending companies and banks that look like this. You can google 'wholesale mortgage rate sheets' to see more examples. So here's a snip of a rate sheet showing todays rates on FHA 30 year fixed mortgages  You can see the Y axis has the interest rate, and the X columns are for 21, 30, and 45 day locks. Now I'm being very general here, because there's tons of factors that goes into pricing a mortgage, but these are generic baselines. These numbers can move several points either way depending on what state you're in, Loan To Value of the loan, credit scores, etc. This is more of a best case scenario. So the number in parentheses is a rebate amount a mortgage broker would earn by placing the loan with that lending company. So looking at the example, placing a 200,000 dollar loan at 4% on a 21 day lock would earn them a rebate(commission) of 3.158% or $6,316. These example numbers are a little high... most rate sheets I found today are paying about 2% on a 4.00% FHA 30 year loan. No idea why this place is paying 3.1. So sanchez in your case, your broker might be offering you a no fee refinance @ 4.5%. He's probably making about 5 points (%) on that deal, so if the refi is 150K, he will pocket 7500 in commission from the deal, BUT he would also have to pay all your fees. Title fee, recording fees, etc. He also could just be trying to gently caress you in the rear end and make you pay those feels while he pockets it all. Who knows. Typically if you want the lowest rate possible, which right now is 3.750, you'll need to bring money to the table. Most mortgage brokers I used to know shot for 2 to 3% earnings on the transaction, anything less and it wasn't worth their time. After they pay for overhead, taxes, office space, staff, etc, they need to still make some money. There are some smooth talking brokers out there that will try to get you to pay a point up front on the deal, fees, and then keep the whole commission to themselves. Don't fall for that poo poo, but on the flip side don't expect people to work for free. Chasing down all the documents for a mortgage is a very time consuming process. *caveat* My examples are best case scenario, and pricing a mortgage product has lots of variables involved. For example, on the image of a sheet I posted above, if your credit score is between 640 and 660 you have a .250 adjustment to the rebate, and if the LTV is > 80% you're looking at another full point... so that 2% rebate on a 21 day lock @ 3.75% turns into .75% after the adjustments happen. .75% rebate means you're paying a bunch of fees out of pocket. You might choose to pay those fees to get that rate, or you might sign at 4.25% which would give you a net rebate of 3.5% which would help with fees and commissions. I really suggest finding a broker who is willing to sit down and explain the entire transaction to you, there are some brokers out there that are 100% upfront about everything. I also suggest to anyone thinking about refinancing, FHA 15 year paper is at 3.25 right now. If you're at over 5%, you could see a minimal increase in payment and cut years off your mortgage and hundreds of thousands of dollars in interest by changing to a 15 year note. edit: *double caveat* My family exited the mortgage broker business in 2007, so there may be new rules in place governing transactions like this that I'm not aware of, but the general idea of this post should still be accurate. I think they changed the maximum rebate/commission a broker could make to 4% a while ago, so there's no more predatory lenders tricking people into 5.5% mortgages and making 9% commission on them when they could have gotten a 4.25% loan and everyone would be happy. skipdogg fucked around with this message at 20:06 on Aug 18, 2011 |
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Aug 18, 2011 20:01
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archangelwar posted:They are in the luxury position of being able to both fully fund traditional retirement options and have money left over. Unless I am missing something, there are no indications that they need to be conservative with their wealth building options at this point, especially given that they have seemingly wealthy family as well as external liquid assets available. I get the feeling that, though they (admirably) are living well beneath their means and have high salaries, they are not particularly financially sophisticated (I think that foregoing tax-advantaged retirement plans to save for a house is not a terribly wise move), and I think sitting down with a financial planner type and discussing retirement planning, financial goals, budgeting, etc. would be really helpful for them.
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Aug 18, 2011 20:38
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Thank you for that incredibly informative post. (ditto Captain Windex) We have about 60k in equity and would be refinancing about 210k. We both have thin but good credit (700ish) and excellent dti and job history (210k is not an expensive mortgage these days). The guy is an actual broker, he does not work for a bank. It definitely sounds like he can do better. The 15yr option is probably worth a look if it'd get us into the 3-4% range.
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Aug 18, 2011 20:41
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skipdogg posted:edit: *double caveat* My family exited the mortgage broker business in 2007, so there may be new rules in place governing transactions like this that I'm not aware of, but the general idea of this post should still be accurate. I think they changed the maximum rebate/commission a broker could make to 4% a while ago, so there's no more predatory lenders tricking people into 5.5% mortgages and making 9% commission on them when they could have gotten a 4.25% loan and everyone would be happy. Welp, you saved me typing a whole lot of words about how interest rate pricing works. There have been some regulatory changes since 2007, but how you explained it is still essentially correct. One thing to add is how the different types of loan originator impact your pricing/disclosures. As I alluded to in an earlier post, there are essentially 3 types of loan officers/loan companies: retail, brokers, and correspondents. Retail: These are loan officers/loan shops that work directly for a specific (generally large) mortgage lender. These are your Bank of America/Chase/Wells Fargo/etc loan officers. You walk into a BoA branch, talk to a BoA loan officer, and get a BoA loan. Generally speaking, these guys will not be able to offer as competitive rates as the other business channels as there is less incentive on the part of BoA (or Chase, or whoever) to compete on offered rates/pricing because their loan officers have little (if any) ability to take the loan to a competitor. They may have access to some loan products that aren't offered to the non-retail branches, but if you're just looking for your standard conventional/FHA/VA financing this doesn't really matter much. Brokers: These guys are not attached to any particular mortgage lender or bank, though they may have a few preferred lenders that they send most of their business to. As such, they have a lot more options available to you and can work with you to find an appropriate lender for you depending on your circumstances. Every mortgage lender has their own particular overlays, so even though the loan may not be approvable with say Chase due to their requirements for using rental income to qualify, it might work through Wells Fargo because they have different requirements (note: I don't know Chase/Wells actual guidelines, just picking the names as an example). Your broker will work with you to get the appropriate loan documentation for your file and send it off to the mortgage lender who will be funding your loan to be underwritten. These guys will generally have more competitive rates than retail because the mortgage lender needs to provide an incentive to bring the loan to them rather than the guy down the street. The nice thing about broker shops is that with recent regulatory changes, all that pricing/premium you're getting due to picking a higher rate goes directly to you to help you cover your fees and closing costs. Brokers basically get paid what they disclosed to you up front and nothing more. Correspondents: The key difference between brokers and correspondents is who is going to be funding your loan. Correspondents are more likely to be your small community banks, credit unions, that sort of thing. They have their own money available to lend. Instead of taking your loan directly to Chase and having Chase fund your loan, they will fund your loan with their own money, and then turn around on the secondary market and sell your loan to Chase and be reimbursed for the money they lent to you. These guys are likely to have the best rates available to them since they are, generally speaking, more reliable and in better financial shape than a broker shop might be. You may not actually see any rate savings here though, because they are not required to disclose to you how much they are being paid by the mortgage lender for delivering the loan to them. In essence, the correspondent is your lender and so they are only required to disclose the financial aspects that result from funding your loan. What they receive later on when they sell the loan to a servicer/mortgage lender is not disclosed. This doesn't make going through a correspondent automatically a bad idea of course, some places will disclose how much they are being paid on the back end. You can always ask, they may or may not tell you - if they refuse to tell and you don't like that you can always walk away. Just depends on the company you're going through - don't be afraid to get quotes from a few different places to make sure you're not getting fleeced on your rate. Don't shop around too much though, as excessive mortgage inquiries on your credit report is a big red flag to your underwriter.
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Aug 18, 2011 22:08
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archangelwar posted:Roth IRA is currently not an option for them, and assuming they are smart( unless the cap is completely removed at some point) There is a loophole in existing law that effectively uncaps the Roth IRA. Anyone with earned income can get their $5K/yr in until the law is changed again.
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Aug 19, 2011 04:21
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We're interviewing our first Realtor to sell our home & buy another. What questions should we be asking? This guy was referred to us by friends who have done several deals with him. We bought our current place using a friend, who we enlisted only after finding the place. Said friend is now out of the business, thus the need to find a new one. Jorath fucked around with this message at 03:47 on Aug 21, 2011 |
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Aug 19, 2011 16:40
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After only four months of owning this house, I just received a letter stating that my loan is being transferred to another bank to fulfill the needs of investors. I realize that this is common and happens a lot as I was told when I first went for a pre-approved mortgage loan. I was wondering how many times some of you long time house owners have your loan transferred and if there was any issues or mistakes during the process?
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Aug 20, 2011 03:40
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ijii posted:After only four months of owning this house, I just received a letter stating that my loan is being transferred to another bank to fulfill the needs of investors. I didn't even get to make my first payment before my loan was transferred. It was seamless, they even forwarded the check I had already sent.. they tend not to gently caress up 6 figure transactions too often.
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Aug 20, 2011 04:12
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skipdogg posted:I didn't even get to make my first payment before my loan was transferred. Same here, my mortgage's been transferred three times (Broker -> GMAC -> Ally -> Freddie Mac) and I don't even have to change where the payments go. I was hoping they'd gently caress up at some point so I could put the screws to them, but I was disappointed.
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Aug 20, 2011 09:37
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Back when I had an 80/20 loan, the two loans were transferred back and forth quite regularly. I remember updating my online bill pay every couple of months, and it was quite annoying. I refinanced a few years ago into a 15-year loan and Chase has held that loan the entire time. 
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Aug 20, 2011 15:15
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skipdogg posted:I didn't even get to make my first payment before my loan was transferred. Me too. I closed the last week of June, and by the second week of July I received a notice that my mortgage has been bought out by Wells Fargo. I did get 3 different bills for my first mortgage payment though (loan originator, middle man during the transfer process, and then Wells Fargo).
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Aug 20, 2011 16:09
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My loan was bought by Wells Fargo so fast that my first payment went to them. And since I was already a Wells Fargo customer, WF figured that out and actually added the mortgage account to my existing account, so I was able to make my first payment by setting up autopay directly from my checking into the mortgage account. In other news, rates are now low enough that it looks like it's going to make sense for me to refinance. My existing loan is a 30-year at 5%, and it looks like I can either save a few hundred a month with a 3.75% 30, or for two or three hundred a month more, go to a 15-year at 3.25%. In both cases, FHA mortgage insurance goes up (by about $100 a month), because the factor has changed from .55% to 1.10% or 1.15%. That added insurance cost was what was keeping me from refinancing around six months ago but now interest rates are so low that I can still save money even with the higher insurance. Here's what my broker sent me as a very preliminary set of numbers - he promised to put together detailed quotes over the weekend: 30 Yr Fixed Loan Amount: $230,000 Rate: 3.75% Payment: $1,065.00 Credit for Closing Costs: $1,743.00 15 Yr Fixed Loan Amount: $230,000 Rate: 3.25% Payment: $1,616.00 Credit for Closing Costs: $2,805.00 How do those credits look right now? And, the payment is (I believe) not including FHA mortgage insurance, tax, or property insurance (I'm still using escrow for those, out of convenience). By comparison, my current payments (again excluding insurance, MI, and taxes) are $1269.25. So, 15-year fixed will cost about +$400/mo. That's... rough, do-able maybe if we cut a lot of stuff, but it eats up a lot of the monthly budget. So I realized another option is to go with the 30-year option, but continue to pay as much as I am now. An extra $300 a month straight to principal. The amortization table I just ran says payoff in Aug 2031, so it pretty much exactly converts it to a 20-year loan, while still giving me flexibility in my payments if I suddenly have a financial problem (like if the wife loses a job or whatever).
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Aug 21, 2011 08:03
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I'm having the same problem myself- refinancing four months into a mortgage seems stupid but knocking a 30 year down from 5% to 3.75% seems worth looking into. Is that only for FHA loans?
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Aug 21, 2011 10:07
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FHA has a rapid refi option that means you don't have to have a re-appraisal or do a credit check, so that streamlines things. It's literally an FHA Streamline Refi. However, I believe the rates are available to everyone; so for a non-FHA, you should still be able to find value there. The question will be how much the fees are. Even at $100 a month savings, if I can do a refi for like, $2000, that pays for itself in less than two years and is totally worth it.
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Aug 21, 2011 18:32
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I want to refinance my mortgage as I'm currently at 5.125% on a $170K mortgage, bought the house last March. Chase (who I went through on the initial mortgage) is offering me 4.71% via mailed offer, but I think that's too high. Google Advisor listed Advance Mortgage Corporation as one vendor offering 4.25%, which is a better rate to me. Here's their website: http://www.advancemtg.com/ Are there any risks or headaches to consider if I try AMC, instead of picking the higher rate from Chase? I currently bank with Chase so it's been convenient viewing my mortgage online with them, too. Another mortgage refinancer listed by Google Advisor was Home Finance of America, with a 4.125% rate with a $900 fee, but the e-opinion reviews indicated a few HFA deals went bad, with the brokers coming up with surprise fees right before closing.
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Aug 21, 2011 18:54
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I want to refi too but I tried to a year ago and the appraisal killed it. Thinking about going to an independent mortgage broker and seeing what they have to say. Any suggestions on how to find a good one? Or anybody in NYC know a good one?
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Aug 22, 2011 16:25
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DO NEVER LANDLORD http://www.nypost.com/p/news/local/he_squat_free_viHXUENWS8sjjrtiamVySJ
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Aug 23, 2011 16:53
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skipdogg posted:
Is there any way to do this? Our current one is entirely not upfront about everything (He wanted 3k in cash to get that 4.5% as well, forgot to mention that) Random googling does not seem like a good approach either. We are in MD, if someone reading this thread happens to have a recommendation.
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Aug 23, 2011 18:34
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sanchez posted:Is there any way to do this? Our current one is entirely not upfront about everything (He wanted 3k in cash to get that 4.5% as well, forgot to mention that) Random googling does not seem like a good approach either. You can try the Up Front Mortgage Broker associate website. http://www.upfrontmortgagebrokers.org/search_umb.asp?StateAbbrev=MD Here's a rate sheet for today. http://www.msiloans.biz/Rates/MSIWholesaleRates.pdf You can see a conventional 4.5% loan on a 30 day lock is paying 3.1% rebate. The same 4.5% FHA rate is paying 5.2% rebate! Bringing 3K to the table I would be expected 4.25% or lower depending on fees and stuff. Have him clearly explain everything on the GFE (Good Faith Estimate) and then shop around
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Aug 23, 2011 19:52
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Seller accepted offer of 9900 under asking price with 6% concessions and all appliances. Now i get to be anxious waiting for her bank to approve the short sale. HOORAJ.
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Aug 23, 2011 21:43
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6% concessions jesus christ that is insane. I can't believe that is even legal.
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Aug 24, 2011 07:05
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DancingMachine posted:6% concessions jesus christ that is insane. I can't believe that is even legal. You can do up to 9% on a conventional primary residence <75% loan to value  Technically you can do even more than that, but it gets treated differently and things get rather messy at that point.
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Aug 24, 2011 07:20
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Leperflesh posted:FHA has a rapid refi option that means you don't have to have a re-appraisal or do a credit check, so that streamlines things. It's literally an FHA Streamline Refi. I currently have a 30-year fixed FHA loan at a terrible (6%+) rate on a ~$200k house I bought about three years ago. I haven't checked the balance in a few months, but I pay in an extra $300-500 toward the principal most months, so I've paid it down at least a bit -- say, maybe $180-185k remaining? Just going by the rates and mortgage calculators I've looked at online, I could probably go from my 30-year to a 15-year and not actually have much (if at all) higher payments each month. I'm pretty retarded about these things though -- do I just start calling banks and mortgage companies asking about FHA rapid refi's? I don't really understand the difference between FHA and other loan types other than that FHA is government-insured (and charges PMI fees?). Is there another type I should be looking at? I can afford to pay points/fees if it will get me a better rate and save me more in the long run.
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Aug 24, 2011 19:09
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Take a look at this incredibly prescient June 2007 article that explains what seller's concessions are, and why they're dangerous (to capital markets). The article presents an e-mail sent in by New York real estate attorney. Here's the part that blows me away: Nishani Naidoo posted:In other words, where is the fraud if everyone is aware that this [concessions that artificially inflate the sale price of a house via a cashback transaction] is going on? I knew about how subprimes, liar's loans, and the housing bubble contributed to the housing crash. I also knew about how securitized mortgages disguised the risk to the capital markets, contributing to the crash and triggering the debt crisis. What I didn't know was that these consession tricks existed, or that they could also have contributed both to the bubble itself (by inflating the listed sale prices of houses, and by adding loans with essentially negative equity from day one to the mortgage securities).
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Aug 24, 2011 19:19
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Gonna double post here to keep topics separate.WhiteHowler posted:This seems like what I'm interested in. FHA is indeed a government program. It has been used a whole lot in the past couple three years, because it offers a lower rate of mortgage insurance to buyers who are paying less than 20% down, than the regular loans offered by banks. It also offers various other advantages to buyers. FHA has restrictions as well, designed to prevent buyers from getting into houses with poor or nonexistent living facility: an FHA inspector must determine that the house is reasonably livable before you can use an FHA loan. (There's a different FHA fixer-upper loan, which can let you buy such a house by financing improvements, but that's an unimportant detail here.) The key thing with FHA is that it's offering a buyer a better deal. If you have an FHA mortgage, you can (usually) use an FHA rapid Refi to refinance without having to perform a new appraisal or credit evaluation. Which means you can refinance for less money, and without the risk that the bank determines your house's value has declined and therefore you cannot borrow as much as your outstanding loan, or that your credit is no longer up to their standards, or whatever. That said, there's no reason why you can't move from an FHA to a non-FHA loan, as far as I know; and there's possible reasons why you might want to. For example, most mortgages dismiss the requirement to have a PMI policy after reaching 20% equity. For FHA, this is actually 22%, and on top of that, there's a minimum duration (mine was 7 years on my 30-year mortgage but this may have changed). If you are rapidly paying down your mortgage, it might actually work out to be better to pay a higher per-month PMI via a standard (non-FHA) loan for less time, than the lower FHA mortgage insurance premium for a longer locked-in period. On the other hand I'm not sure if a refi is an acceptable way to escape from FHA's up-front contractual requirements (like that you must live in the home, you can't rent it out). So the answer to this question (is an FHA re-fi right for you) is, "it depends on your particular situation, but probably yeah". As for how to do the refi - I'm using the same mortgage broker that I used when I bought the house, because he is an FHA specialist. You can use a broker, or you can seek a good deal from among multiple banks. There have been discussions previously in the thread about which is better; I like a broker but there's good reasons why some folks prefer not. If you do go with a broker, I suggest finding one who is experienced with FHA, but that's probably most brokers these days since such a high percentage of mortgages in the past 2-3 years have been FHA.
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Aug 24, 2011 19:33
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Leperflesh posted:Gonna double post here to keep topics separate. Small point, FHA mortgage insurance is no longer cheaper than conventional. It's now 1.10 or 1.15 percent (depending on % down) versus .75-.95% with conventional. The key advantage is lower debt-to-income requirements with FHAs and sometimes lower rates. A question I have: with this rapid refi, do you also get another 1% of the loan balance tacked on for the mortgage insurance? I just closed on my FHA loan two months ago, and seeing these rates plummet, have half-jokingly considered refinancing already if I could get the rate. Swallowing another 1% added to my loan balance is not something I'm too thrilled about though, unless it works out mathematically.
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Aug 24, 2011 19:49
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Good question; I don't know yet. My guy has been busy and I haven't seen the full breakdown, but I will definitely ask. Also yeah, I knew the MI rate had gone up but I didn't realize it was now equal to or higher than conventional rates.
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Aug 24, 2011 21:58
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Leperflesh posted:Good question; I don't know yet. My guy has been busy and I haven't seen the full breakdown, but I will definitely ask. Went from .9 to 1.15 from the time I started the process.  rude surprise.
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Aug 24, 2011 23:03
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DancingMachine posted:6% concessions jesus christ that is insane. I can't believe that is even legal. 6% of 60000 isn't as much as it would be on the houses you guys buy!
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Aug 24, 2011 23:09
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Ozmiander posted:6% of 60000 isn't as much as it would be on the houses you guys buy! That's true, but if you put less than 6% down, it means you have a mortgage for more than the house's real sales price. It also means a casual buyer in your neighborhood might see the sale price and not the concession and believe that your house actually sold for $60k, when it was actually $56400. I dunno if appraisals for the purposes of comps know about those concessions either, so it could in a very real way be inflating the prices of other houses that get sold in your area by some small margin. I don't think anyone begrudges you the money, just the fact of concessions being kind of a crazy thing that maybe contributes to housing market insanities.
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Aug 25, 2011 02:00
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I have a question. I'm in the process of buying a 2 room condo for 110k with a VA loan. The monthly payment for the mortgage+hoa+insurance+property tax is lower than the rent in similar locations (its gonna be around 900 a month, and the rent around here for 2 bedroom apartments is 900-1200) and rent seems to be steadily rising here in Austin. The seller has agreed to pay all the closing costs so I'm basically paying nothing since VA loans don't need a down payment. So basically, is this stupid and, is a home warranty worth it? I've heard they come in handy if an air conditioner breaks or something but I dunno if its just a waste of money for condos.
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Aug 25, 2011 02:07
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Leperflesh posted:That's true, but if you put less than 6% down, it means you have a mortgage for more than the house's real sales price. It also means a casual buyer in your neighborhood might see the sale price and not the concession and believe that your house actually sold for $60k, when it was actually $56400. I dunno if appraisals for the purposes of comps know about those concessions either, so it could in a very real way be inflating the prices of other houses that get sold in your area by some small margin. Appraisers discount their assessment of the comps if there concessions in the sale. In my appraisal it was clearly laid out if there were any and their 'adjusted value' showed the concessions.
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Aug 25, 2011 03:43
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TraderStav posted:A question I have: with this rapid refi, do you also get another 1% of the loan balance tacked on for the mortgage insurance? I just closed on my FHA loan two months ago, and seeing these rates plummet, have half-jokingly considered refinancing already if I could get the rate. Swallowing another 1% added to my loan balance is not something I'm too thrilled about though, unless it works out mathematically. Looks like FHA allows for partial refunds of your UFMIP in you're refinancing within 3 years of the loan being refinanced - but the streamlined refis still have the same 1% tacked onto the loan amount. I have no idea how this actually works in practice since I only do conventional stuff, but looks like you might be able to get a bit of that back... somehow TraderStav posted:Appraisers discount their assessment of the comps if there concessions in the sale. In my appraisal it was clearly laid out if there were any and their 'adjusted value' showed the concessions. Depends on the local MLS system, not all of them require the realtors to report actual concessions paid by the seller. The appraiser will usually note if concessions are common for the area, but not really the same.
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Aug 25, 2011 04:47
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Pram posted:I have a question. I'm in the process of buying a 2 room condo for 110k with a VA loan. The monthly payment for the mortgage+hoa+insurance+property tax is lower than the rent in similar locations (its gonna be around 900 a month, and the rent around here for 2 bedroom apartments is 900-1200) and rent seems to be steadily rising here in Austin. The seller has agreed to pay all the closing costs so I'm basically paying nothing since VA loans don't need a down payment. At 4.5% on a mortgage that starts next month, you'll have $10,000 in equity in November 2016. You'll get up to 20% equity in just over ten years. You'll have paid $45,311.21 in interest during that period. You'd better love this condo, because you won't be able to afford to move out of it, even if the market doesn't drop. Renting sucks, but if you can save any money at all you'll be way better off in the long run if you wait to buy until you can put down 20%.
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Aug 26, 2011 07:27
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I have a dumb question about home owner's insurance. I rent, so this is just informational on my part. My neighbor had some damage from the earthquake here in VA. She has a townhouse, and her house kind of "separated" a couple of inches from her next-door neighbor's up near the roof. Her insurance company is saying that she needs an earthquake endorsement in order to file a claim, which her policy doesn't have. Her policy says nothing about needing an endorsement for earthquakes, it spells out how damage from flooding isn't included, and that hurricane damage has a higher deductible. But other than that, it says nothing about earthquakes, categorizing everything besides flooding and hurricanes as "peril." So is she screwed? There are apparently many other stories like this around here. Her next door neighbor for instance has the same problem. (And she currently has a contract on her house) Nobody had earthquake endorsements, but their policies say nothing about earthquakes.
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Aug 26, 2011 15:09
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Unfortunately, standard homeowners insurance policies don't cover earthquake damage without the earthquake endorsement. Even an open perils policy (aka "all risk," a term that I hate and always clarify with my customers) specifically excludes it. Look for "Earth movement" in the Exclusions part of Section 1. If you let me know what policy form she has (in the corner of the page, most likely starts with "HO") then I point you toward the language.
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Aug 26, 2011 15:33
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