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    Thread: Mortgage Q&A

    1. Member ruetzal's Avatar
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      06-24-2011 09:15 AM #51
      yep I sure do. Since you don't have a lot to put down you would have PMI (private mortgage ins) or UFMIP & MMIP (upfront mtg ins prem & monthly mtg ins prem) Anything over 79.99% loan to value requires mortgage ins. I have found if you don't have the 20% down payment its best to seek an FHA product or rural housing depending on the area. These 2 products are guaranteed for the lender in case of default by the borrower. The gov't insures these programs. Although these monthly premiums have increased in recent years its still cheaper to seek the insurance through these programs. The monthly premiums on FHA are considerably cheaper than the conventional program route due to the fact that your gaining insurance thru the gov't vs. a private entity for conventional. FHA requires an upfront premium generally 2-3% of the loan amount that can be financed in the loan and then the monthly premiums, becuase of this upfront premium, are greatly reduced.

      FHA programs can be found thru companies like BOA, Chase, GMAC or an independent broker. Most local banks do not do FHA products. These products are bought by bigger investors like BOA/Chase and then they sell the investor rights to Freddie Mac and retain the servicing rights. So you will be serviced by the BOA's/Chase's but really the gov't will own your loan.

      So ensure you finance thru someone who can run #'s for you on both conventional and FHA to determine what program works best for you. I posted a link to find out if your property is located in a rural housing zone, if so you can finance up to 100% of your loan with the Rural housing program. However since you are in AZ I am betting that you would not be in this area.

    2. Member ladykiller's Avatar
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      06-24-2011 08:23 PM #52
      Do you have any guestimate as to what I could expect to pay for mortgage insurance with this loan ammount?
      i have nerd tendencies

      i work in a world of shoulds (>ლ)

    3. Member ruetzal's Avatar
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      06-25-2011 12:02 PM #53
      I will get you a good rough estimate on monday, as for now I think they are both 2-3% of loan amount for upfront mip (what you pay at closing) and 2-3% of monthly payment amount. I will confirm monday.

      also I should probably correct my previous statement. In the past these agencies were funded by private dollars. Ins companies and bigger entities that soaked up America's debt and were backed by the Gov't in terms of insurance, not Gov't owned as I stated. Ofcourse these days they really are
      Last edited by ruetzal; 06-25-2011 at 12:11 PM.

    4. Member ruetzal's Avatar
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      06-27-2011 12:17 PM #54
      The FHA premiums can vary. Most likely on a purchase you will be paying 1% upfront and 1.15% in the monthly premium. Its best to have your loan officer run your situation. It can really range from 1-2.25 from upfront/monthly

    5. Member ruetzal's Avatar
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      06-28-2011 03:24 PM #55
      4.5% APR on a 30 year, 3.75% APR on a 15 year and 2.985% APR on a 5/1 ARM

    6. Member ruetzal's Avatar
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      06-29-2011 04:16 PM #56
      Rates rised today

      4.625% on a 30 year, 3.75 % on a 15 year and 3.125% on a 5/1 ARM

    7. Member ruetzal's Avatar
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      07-06-2011 02:23 PM #57
      rates are holding steady.

    8. Member evosky's Avatar
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      07-07-2011 08:59 AM #58
      about to go into the closing period on a house. got some really noob questions:

      - the rates you post up, are they applicable nationwide or are they specific to your particular lender/region?

      - what's your take on the market conditions right now and forecast for the next year or so? it varies region to region definitely, so any insight to the DC metro area (northern VA specifically) would be of great interest.

      - i think i have an idea of when a 15yr would be better than a 30yr, and vice versa, but in your professional opinion, when does one option trump the other?
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      I'll break it down for you simple minded people. VWvortex. The VW stands for Volkswagen. And when you create a forum, admins can create sections within the forum. This forum has a section for general car chit-chat. The car lounge. So you see, even though it's a VW forum, you can still discuss other topics.

    9. Member ruetzal's Avatar
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      07-07-2011 12:17 PM #59
      Quote Originally Posted by evosky View Post
      about to go into the closing period on a house. got some really noob questions:

      - the rates you post up, are they applicable nationwide or are they specific to your particular lender/region?

      - what's your take on the market conditions right now and forecast for the next year or so? it varies region to region definitely, so any insight to the DC metro area (northern VA specifically) would be of great interest.

      - i think i have an idea of when a 15yr would be better than a 30yr, and vice versa, but in your professional opinion, when does one option trump the other?
      yeh those are not specific to area, depending on ones situation you can take rate hits for type of loan (cash out refi, rate/term refi, investment/non investment. etc) for a straight up primary residence purchase with good credit you should be at/near or under my rates posted. Location has nothing to do with it at least in the lower 48.

      The Northern VA/DC area is the lone duck in the US right now. Properties in that area have actually appreciated. Generally speaking a area with high Gov't employment generally will always beat most areas because of Job Certainty. Madison is the same way in Wisconsin right now they literally have not depreciated over the last 4 years when almost everyone has. DC is in this boat in the last few years and at latest reports I have saw are still appreciating decently. Although my analysis over almost all other areas is bad and most areas will continue to modestly depreciate over the next few years and then flatening out relatively soon. As for my area I think we found pretty much the bottom (Milwaukee WI, well just outside). As long as the foreclosure continue to wash thru most areas won't find any appreciation in the near term but most decent areas will be flat. City areas probably will continue to depreciate due to foreclosures.

      Well the main thing between a 15 and a 30 year is rates. You will get a decently lower rate on a 15 year but your monthly payments will be higher. You will pay significantly lower interest over the course of time then a 30 year. I am not sure your age or your cash situation but my suggestion would be if you are younger and don't have a wopping amount of cash to take the 30 year and save your cash for awhile longer. You can always refi to a 15 in the future and a 30 year will allow your savings to grow a bit stronger. Once you gain a strong financial foothold you should consider a 15 year. YOu should have 1 year worth of unemployment in your savings account these days for a worst case situation. try your best to figure your monthly bills. A tracking excel sheet works best here and then get a good feel of your expense monthly and save accordingly.

    10. Member ruetzal's Avatar
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      07-11-2011 02:51 PM #60
      4.5% on a 30 year, 3.625% on a 15 year and 3% on a 5/1 ARM

    11. Member evosky's Avatar
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      07-18-2011 10:25 AM #61
      locked in a 4.5% @ 30 yr just now. seems to have plateaued this past month and probably will go up rather than down.
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      Quote Originally Posted by MrSavvy View Post
      I'll break it down for you simple minded people. VWvortex. The VW stands for Volkswagen. And when you create a forum, admins can create sections within the forum. This forum has a section for general car chit-chat. The car lounge. So you see, even though it's a VW forum, you can still discuss other topics.

    12. Member ruetzal's Avatar
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      07-20-2011 12:55 PM #62
      sweet yeh there is some upward pressure lately but seems to be holding steady

    13. Member ruetzal's Avatar
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      08-04-2011 03:56 PM #63
      well its been awhile. Recent market turmoil benefits us like usual

      4.25% on a 30 year, 3.375 % on a 15 year and 2.75% on a 5/1 ARM

      these are some low f'n rates

    14. Member ruetzal's Avatar
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      08-08-2011 01:34 PM #64
      well market keeps crashing and we keep getting better rates.

      I get this question a lot. Hey are the rates you posted the ones I can get, then they tell me where their from and how good their credit is.

      The answer is you should be able to get at or below what I post here. There are a few things that can effect rates. Investment properties you will get a higher rate, these are obviously more risky than a primary residence. Lines of credit also a slightly higher rate, constructions same thing. Bottom Line for a good credit borrower on a primary residence you should be getting the rates I post. Also rates do not fluctuate on a particular location.
      Last edited by ruetzal; 08-09-2011 at 02:01 PM.

    15. Member ruetzal's Avatar
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      08-08-2011 01:41 PM #65
      just to be more clear on how rates fluctuate
      Property Type-Primary, Investment, 2nd home etc. primary here is the lowest rates
      Product Type-FHA, VA, Conv, Rural Housing etc. these are all roughly the same but rates can differ in these areas (albiet slightly)
      Credit-Over 740 you will get these rates, below you start taking some small hits and under 660 it gets somewhat nasty.
      Loan Officer Selling-face it this is what they do. With the new regulation its been tamed down since there is no reason for them to oversell it, ofcourse if they offer you a credit at the closing table ensure you understand this. They are selling you a higher rate and giving you back the overage of what they can only make. New Regulation enforces them to take a exact % of your loan amount that is negotiated with your lender up front, they can't take more and can't take less so if they are crediting you at the table you are getting a higher rate although the overage credits your closing costs so for some its a viable option.

      Also this is some good questions to ask when applying for a mortgage.

      1) How long have you been in the mortgage business?
      Be wary of newbies. Anybody with less than three years of experience could cause you extra anxiety and possibly a declined loan.
      2) Why is this loan the best one for me?
      This question is a great way to gauge how knowledgeable the loan officer is on all types of loans. If they are not able to provide you with a detailed answer, it could mean that they are not considering the best possible loan option for you.
      3) Should I pay closing costs or take a higher rate with less costs?
      If you have an idea of how long you plan on being in your new mortgage, your loan officer should be able to run a break even analysis to find out if you should take a low interest rate and pay closing costs or a higher interest rate with little or no closing cost.
      4) What hours are you available?
      You should want someone who will work as many hours as it takes to get your loan done, not someone who is content with only working nine to five. The more time your loan officer is available, the quicker you will be able to sign.
      5) How much money are you making on my loan?
      Don’t be ashamed to ask this. Their payment should be as transparent as the mortgage rates they are providing you.
      Last edited by ruetzal; 08-09-2011 at 02:00 PM.

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      08-09-2011 01:05 PM #66
      What do you need to qualify for a refi/mortgage these days?

      I've been intentionally unemployed for the past two years, but will be starting a new career later this month with a fair salary.

      I originally purchased my house in 2007, but refi'd in 2009 to take advantage of the rates.

      I have no debt besides the house, and have a 785 beacon.

      How long should I wait before applying for a refi? I'm at 5% 30yr fixed currently, no escrow and about 60% LTV, but if I can take advantage of 3.5-4.25% I'd like to jump on it when possible.

    17. Member ruetzal's Avatar
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      08-09-2011 02:05 PM #67
      well think your major problem is that you would need to show a steady stream of income. My Fathers friend contacted me today with a deal he was working on. He is a millionaire but is retired and does not have a steady stream of income to qualify him on a mortgage. With no stream of income you will have a very hard time getting a mortgage. There is a few ways to get around this but I would suggest you bring your 2010 1040's with you to the bank/broker.

      You don't necessarily need to be employed but every bank in the country requires an income stream of some sort. Some types of income streams qualify and some do not.

      Sounds like other than that you would be in pretty good shape.

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      08-10-2011 01:39 PM #68
      I understand that now....back in 07 I bought my house on stated income, LOL. No verification needed and they approved it.

      How long should I wait after starting employment to pursue a refi? I'll go after my first paycheck if rates are good and that'll work.

    19. 08-10-2011 02:07 PM #69
      Quote Originally Posted by ruetzal View Post
      My Fathers friend contacted me today with a deal he was working on. He is a millionaire but is retired and does not have a steady stream of income to qualify him on a mortgage.
      Buy house with cash

      Cash out refi

      Done

    20. Member ruetzal's Avatar
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      08-10-2011 02:28 PM #70
      LOL yeh stated got out of hand for awhile. Once this program was heavily abused by brokers actually continuing running DU (Fannie Maes approval system) with different house appraised values until they rec'd an appraisal waiver, after the waiver was rec'd it was a 10 day turn time to closing. Crazy DU still to the day is believed to never do no harm, when the mortgage industry allowed a computer software system that can be riddled with false information print an approval without anyone verifying was beyond me. Today this is the case although it is now verified by a human, LOL. Stated programs will come back eventually but I am hoping for some better guidance on these

      To better answer your question they like to see a year of employment although if you have a good enough reason for the gap of unemployment you can still get approved. I don't think 2-3 months would work but you could easily call a bank/broker and ask them what they like to see.

      As for the last comment. That was exactly his plan to pay with cash and then do a cash out later, however on a cash out refi you don't get the low rates, you take a cash out hit in rate. Generally about .50% also you still need to verify income streams with these programs which at that time he would be receiving Social Security which can be used. He would still take a risk of not getting a cash out refi to go thru.
      Last edited by ruetzal; 08-10-2011 at 02:32 PM.

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      08-10-2011 03:42 PM #71
      ^^^Thanks for the insight, I may do some asking around in the future, we'll see where rates go.

      As to the other question....what about a HELOC? I know someone who purchased their home outright, then immediately took out a heloc for 50% of the value. That was in 2008 and there is no fee if you don't use it, but they have had 1.9% since the opening, and it's a 10 year thing. It's nice to have the money available at least, and in this method you aren't charged for anything unless you use it.

    22. Member ruetzal's Avatar
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      08-10-2011 05:07 PM #72
      wow a** pounding in the market today. Mortgage Brokers Celebrate

      3.875% on a 30 year, 3.25% on a 15 year and 3% on a 5/1 ARM

      Bam great point and thats what I suggested to him. Its very easy to get a heloc on a home especially when you own it out right. Usually they will give you 50% without even taking a look at you thoroughly. One downside is if you wanted to borrow a good chunk of the LOC and hold it out there for an extended period of time. Heloc's are arm's so the rate fluctuates and this is most people's worries when they take one out, also the terms are generally shorter in duration.

      In his situation he wanted a 30 year fixed at these incredibly low rates but today its wasn't feasible until that SS checks come rolling in. Once he starts receiving those I am sure he won't have a problem getting a cash out at .50% over market.

      For most people keeping cash in their pocket is more beneficial than buying down the principal balance. Especially in these times. I always suggest to figure out what you would need to have for 1 year of unemployment. After that you should be pretty set for even the hardest times. Then you can spend your cash how you would like to.

      This is the reason even a guy this liquid would want to extend a term and have a fixed rate. Cash in hand is the most power anyone can have. And even some of the worlds richest folks would rather borrow than spend theres. I have heard/read some interesting articles of all these financial guru's tell you to keep your cash as much as you can and as long as you can. Even if in the long run you spend a few more bucks paying it in interest. It makes sense even though sometimes its not technically the most financial savy decision

    23. Member ruetzal's Avatar
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      08-15-2011 05:11 PM #73
      4.25% on a 30 year, 3.375% on a 15 year and 3.125% on a 5/1 ARM

    24. Member ruetzal's Avatar
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      08-19-2011 02:04 PM #74
      4% on a 30 year, 3.25% on a 15 year and 3.0% on a 5/1 ARM.

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      08-19-2011 09:30 PM #75
      Here's one for you... why do mortgage brokers suck so bad? We had a referred one suggest that we should take a mortgage at the max we could get approved for (which was looking like $150k more than we were comfortable with) AND dump all our savings into a house, this right after we told her we have a baby due in January.
      I'm just a regular Joe, with a regular job. I'm your average white, suburbanite slob.

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