potsticker
Active member
irvinehomeowner said:
Yes, but apparently they're Bank of America now.
How low can we go? 30 yr fixed at 3.75% with no fees...
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Yes, but apparently they're Bank of America now.
I do know, but my ARM doesn't reset for 7 years and the LIBOR rate now is pretty irrelevant for where it'll be in 7 years -- particularly because I hope to have sold my home by then.
Do you monitor LIBOR at all, or is that something you start thinking about a couple years from the first adjustment? My concern would be that rates could rise significantly, and LIBOR could rise disproportionately higher, thereby pushing house prices down right when I'm planning to sell in 5-7 years.
Thats always a great thing to save some mula. Did it cost you any? Is it a simple rate reduction and the term stay the same?
Great rate and good strategies for the later part. Congrat
Yes, but apparently they're Bank of America now.
Perspective
Well-known member
Rising LIBOR
SECular shift
New money-market regulations are pushing up a benchmark interest rate
http://www.economist.com/news/finan...hing-up-benchmark-interest-rate-secular-shift
DURING the financial crisis of 2008, LIBOR was a gauge of fear. The London inter-bank offered rate?at which banks are willing to lend to one another?leapt. (Even then it may have been too reassuring: banks have since been fined billions, and traders jailed, for rigging it.) Lately it has been climbing again: on August 22nd three-month dollar LIBOR rose above 0.82%. That is no cause for panic, but it is a seven-year high and 0.2 percentage points more than in June. What?s going on?
Increases in LIBOR, a benchmark used to set rates for trillions of dollars? worth of loans, usually reflect either strains on banks or expected rises in central banks? policy rates. Although the Federal Reserve has been toying with tightening, this time LIBOR?s ascent has another explanation, traceable to the turmoil of 2008. A change by the Securities and Exchange Commission (SEC) in the regulation of American money-market funds has made borrowing pricier, especially for foreign banks.
Before the crisis investors in money-market funds?which lend for short periods to banks, other companies and the government?had become accustomed to treating their accounts like bank deposits, putting money in and taking it out at will. That changed the day after Lehman Brothers went bust, when the Reserve Primary Fund ?broke the buck?, declaring that investors could no longer redeem shares for the customary $1 apiece. A run on funds ensued; to halt the chaos, the Treasury was forced to guarantee them.
The SEC?s new rule, which takes effect on October 14th, obliges ?prime? funds (buyers of banks? and companies? paper, as well as public debt) serving institutional investors to let their net asset values vary, rather than fix them at $1 a share. To prevent runs, they may also limit and charge for redemptions if less than 30% of their assets can be liquidated inside a week.
This has made prime funds much less attractive, causing a ?change in the landscape of the wholesale funds market?, says Steve Kang, an interest-rate strategist at Citigroup. Between October 2015 and July 2016 all prime funds? assets declined by more than $550 billion, to $1.2 trillion, according to the SEC; ?government? funds that invest in Treasuries and the like have swollen by a similar amount, to $1.6 trillion (see chart). Prime funds have also pushed their liquidity ratios well above the 30% threshold as the October deadline approaches; they are loth to lend for as long as three months. Steven Zeng of Deutsche Bank notes that in the past couple of months the average maturity of large funds? assets has declined from more than 20 days to less than 13.
For foreign banks, which account for more than $800 billion of prime funds? $938 billion of bank securities, this is depleting an important source of dollars. (American banks rely more on deposits.) Borrowing has become pricier, which LIBOR echoes. They seem to be filling the gap: for example, cash-rich companies are thought to be lending via ?separately managed accounts? rather than prime funds. Banks have other alternatives, but borrowing using exchange-rate swaps, explains Mr Kang, is more expensive; central-bank swap lines are dearer still, and because they are primarily regarded as emergency facilities, banks are reluctant to tap them.
The pain will vary from bank to bank. American lenders with lots of LIBOR-linked mortgages may even gain. Some foreign banks may also recoup higher borrowing costs: their floating interest-rate commercial loans outweigh those at fixed rates. But many borrowers will pay a price. The aftershocks of 2008 rumble on.
SECular shift
New money-market regulations are pushing up a benchmark interest rate
http://www.economist.com/news/finan...hing-up-benchmark-interest-rate-secular-shift
DURING the financial crisis of 2008, LIBOR was a gauge of fear. The London inter-bank offered rate?at which banks are willing to lend to one another?leapt. (Even then it may have been too reassuring: banks have since been fined billions, and traders jailed, for rigging it.) Lately it has been climbing again: on August 22nd three-month dollar LIBOR rose above 0.82%. That is no cause for panic, but it is a seven-year high and 0.2 percentage points more than in June. What?s going on?
Increases in LIBOR, a benchmark used to set rates for trillions of dollars? worth of loans, usually reflect either strains on banks or expected rises in central banks? policy rates. Although the Federal Reserve has been toying with tightening, this time LIBOR?s ascent has another explanation, traceable to the turmoil of 2008. A change by the Securities and Exchange Commission (SEC) in the regulation of American money-market funds has made borrowing pricier, especially for foreign banks.
Before the crisis investors in money-market funds?which lend for short periods to banks, other companies and the government?had become accustomed to treating their accounts like bank deposits, putting money in and taking it out at will. That changed the day after Lehman Brothers went bust, when the Reserve Primary Fund ?broke the buck?, declaring that investors could no longer redeem shares for the customary $1 apiece. A run on funds ensued; to halt the chaos, the Treasury was forced to guarantee them.
The SEC?s new rule, which takes effect on October 14th, obliges ?prime? funds (buyers of banks? and companies? paper, as well as public debt) serving institutional investors to let their net asset values vary, rather than fix them at $1 a share. To prevent runs, they may also limit and charge for redemptions if less than 30% of their assets can be liquidated inside a week.
This has made prime funds much less attractive, causing a ?change in the landscape of the wholesale funds market?, says Steve Kang, an interest-rate strategist at Citigroup. Between October 2015 and July 2016 all prime funds? assets declined by more than $550 billion, to $1.2 trillion, according to the SEC; ?government? funds that invest in Treasuries and the like have swollen by a similar amount, to $1.6 trillion (see chart). Prime funds have also pushed their liquidity ratios well above the 30% threshold as the October deadline approaches; they are loth to lend for as long as three months. Steven Zeng of Deutsche Bank notes that in the past couple of months the average maturity of large funds? assets has declined from more than 20 days to less than 13.
For foreign banks, which account for more than $800 billion of prime funds? $938 billion of bank securities, this is depleting an important source of dollars. (American banks rely more on deposits.) Borrowing has become pricier, which LIBOR echoes. They seem to be filling the gap: for example, cash-rich companies are thought to be lending via ?separately managed accounts? rather than prime funds. Banks have other alternatives, but borrowing using exchange-rate swaps, explains Mr Kang, is more expensive; central-bank swap lines are dearer still, and because they are primarily regarded as emergency facilities, banks are reluctant to tap them.
The pain will vary from bank to bank. American lenders with lots of LIBOR-linked mortgages may even gain. Some foreign banks may also recoup higher borrowing costs: their floating interest-rate commercial loans outweigh those at fixed rates. But many borrowers will pay a price. The aftershocks of 2008 rumble on.
Perspective
Well-known member
What percentage of ARM borrowers know the index to which their rate is tied? Those who do know, are probably watching LIBOR rise very closely.
SoclosetoIrvine
New member
I figure I'll ask here
Does anyone have any contacts or work with any lenders that have any "no closing cost" refis on investment property?
Currently at 4.25% 30 year fix for my investment property
I've looked at Cashcall but it was the same rate..does anyone have any leads?
Does anyone have any contacts or work with any lenders that have any "no closing cost" refis on investment property?
Currently at 4.25% 30 year fix for my investment property
I've looked at Cashcall but it was the same rate..does anyone have any leads?
usctrojancpa
Well-known member
I locked in 3.75% with 1.5pts back on my Aliso rental (<60% LTV) with Alyson at RWM....
Alyson Coons
Residential Wholesale Mortgage, Inc.
11234 El Camino Real, Ste. 100
San Diego, CA 92130
BRE # 01405761 NMLS # 1122634
Phone: (858)354-4825
AlysonC@rwmloans.com
www.rwmloans.com
Alyson Coons
Residential Wholesale Mortgage, Inc.
11234 El Camino Real, Ste. 100
San Diego, CA 92130
BRE # 01405761 NMLS # 1122634
Phone: (858)354-4825
AlysonC@rwmloans.com
www.rwmloans.com
paperboyNC
New member
Perspective said:
I do know, but my ARM doesn't reset for 7 years and the LIBOR rate now is pretty irrelevant for where it'll be in 7 years -- particularly because I hope to have sold my home by then.
Perspective
Well-known member
paperboyNC said:
Do you monitor LIBOR at all, or is that something you start thinking about a couple years from the first adjustment? My concern would be that rates could rise significantly, and LIBOR could rise disproportionately higher, thereby pushing house prices down right when I'm planning to sell in 5-7 years.
irvinehomeowner
Well-known member
Same here on our rental with RWMI (non-jumbo, <50% LTV). Could have got 3.625 but didn't lock in time... it could be available now.USCTrojanCPA said:
Ready2Downsize
Well-known member
sgip
Well-known member
Meccos12 - Some suggestions:
1) How do you know the rate your quoted/seeing is a deliverable rate? The only way to know is to have a very current credit report - not your scores, a full report - as that will drive what you can or cannot get from a lender. Scores help, but are they scores focused on auto loans, or credit card offers? Have a mortgage lender run your credit, as any rate or fees your quoted based only on your score is a crap shoot.
2) When are you closing on your purchase? If it's not within 60 days, looking at rates at this stage is a rabbit hole you don't want to fall into. Watch Mortgage News Daily and Freddie Mac's Weekly Rate survey to get a general idea where rates and terms are headed.
3) When are you closing on your refinance? If you have a 3.00 target rate in a 3.50 market, watch loan rate trends once a week, or set yourself up for a rate reminder at a bank. They will ping you when the terms come into view, reducing the check, recheck... check again...and check before bedtime some refinancer's are prone to do.
4) Ignore web rates. Web rates are as vanilla and generic as you can get to appeal to the widest possible audience. In some cases, you'll get that rate. In most cases, you won't OR when you speak to a lender, they will have a better deal available.
5) Ignore APR's. Annual Percentage Rates are easily manipulated numbers and are for the most part meaningless when you finally get an actual financing offer. Compare Loan Estimates for lender fees (Purchase) or all fees (Refinance) to get a concrete idea what you're going to spend.
6) Ask 1-2 Mortgage Banker and a 1-2 Traditional Bank/Credit Union for their loan terms on the same day. Why so few? The vast majority of Mortgage Bankers use either Chase or Wells Fargo to fund their loans so Banker A might be WF and Banker B could be Chase. Banks/Credit Unions may have promotional offers to help reduce your rate, but all in all each bank/credit union's programs are about the same - Bring $$$ to us, and we'll reduce your fee or your rate. There's little sense of expanding the signal to noise ratio you'll get when asking 5-4 Mortgage Bankers and 6-7 Banks what their best deal is. The time spent chasing this with so many companies won't yield a great ROI.
7) Focus on what's important - if it's a purchase, do you chase the low rate and not close as expected? If you find the Lowest Possible Rate Provider - Bank of Unicorn Lending, Mercy Alabama, will that unknown lender blow your offer out of the water? The seller has no idea if that lender can or will perform so they might take another offer with a Union Bank lender because they can see the bankers office on their drive to work.
Please know that this is just a surface level perspective as to what you may need to look for during the financing of your property. Good luck with your search.
My .02c
Soylent Green Is People
1) How do you know the rate your quoted/seeing is a deliverable rate? The only way to know is to have a very current credit report - not your scores, a full report - as that will drive what you can or cannot get from a lender. Scores help, but are they scores focused on auto loans, or credit card offers? Have a mortgage lender run your credit, as any rate or fees your quoted based only on your score is a crap shoot.
2) When are you closing on your purchase? If it's not within 60 days, looking at rates at this stage is a rabbit hole you don't want to fall into. Watch Mortgage News Daily and Freddie Mac's Weekly Rate survey to get a general idea where rates and terms are headed.
3) When are you closing on your refinance? If you have a 3.00 target rate in a 3.50 market, watch loan rate trends once a week, or set yourself up for a rate reminder at a bank. They will ping you when the terms come into view, reducing the check, recheck... check again...and check before bedtime some refinancer's are prone to do.
4) Ignore web rates. Web rates are as vanilla and generic as you can get to appeal to the widest possible audience. In some cases, you'll get that rate. In most cases, you won't OR when you speak to a lender, they will have a better deal available.
5) Ignore APR's. Annual Percentage Rates are easily manipulated numbers and are for the most part meaningless when you finally get an actual financing offer. Compare Loan Estimates for lender fees (Purchase) or all fees (Refinance) to get a concrete idea what you're going to spend.
6) Ask 1-2 Mortgage Banker and a 1-2 Traditional Bank/Credit Union for their loan terms on the same day. Why so few? The vast majority of Mortgage Bankers use either Chase or Wells Fargo to fund their loans so Banker A might be WF and Banker B could be Chase. Banks/Credit Unions may have promotional offers to help reduce your rate, but all in all each bank/credit union's programs are about the same - Bring $$$ to us, and we'll reduce your fee or your rate. There's little sense of expanding the signal to noise ratio you'll get when asking 5-4 Mortgage Bankers and 6-7 Banks what their best deal is. The time spent chasing this with so many companies won't yield a great ROI.
7) Focus on what's important - if it's a purchase, do you chase the low rate and not close as expected? If you find the Lowest Possible Rate Provider - Bank of Unicorn Lending, Mercy Alabama, will that unknown lender blow your offer out of the water? The seller has no idea if that lender can or will perform so they might take another offer with a Union Bank lender because they can see the bankers office on their drive to work.
Please know that this is just a surface level perspective as to what you may need to look for during the financing of your property. Good luck with your search.
My .02c
Soylent Green Is People
irvinebullhousing
Well-known member
Highly recommend SoyLent. He has alot of knowledge in this area.
irvinebullhousing
Well-known member
eyephone said:
Thats always a great thing to save some mula. Did it cost you any? Is it a simple rate reduction and the term stay the same?
irvinebullhousing
Well-known member
I can't believe that. Back in 2010 after the initial major collapse of 2008, If you recall 2010 was the dead cat bounce where the economy sunk even further. This is what called double dipping. Back then I bank with Navy Fed. While our rate was already low 3.75 for 15 years, I called it in and they agreed a one time rate reduction to my loan and the adjustment down to 3.375 and the years stay the same. However, because of paper transactions there is cost of seven hundred and some dollars and some papers work that has to be sign. It outlined the new rate and the effective date of the new term. Hard to believe, that bank just keys in the new lower numbers without anything....
One more data point. We locked a couple months ago at the best rates I have seen in 4 years (the last time we refi'd). We got a 15 year fixed jumbo conforming for 3.125%, with roughly a 1% credit. It'll fund on Wednesday. Both times we went with Amerisave. Good rates, but the overall experience was not great, though to be fair I have nothing to compare it to. On the upside, Amerisave gave a $500 credit bonus for being a repeat customer. I left a little meat on the bone, in case rates get this low again, so I can refi at 3% for another credit.
irvinebullhousing
Well-known member
daedalus said:
Great rate and good strategies for the later part. Congrat
wbresident
New member
Good for folks to track the treasury yield too look at the trend:https://www.treasury.gov/resource-c...interest-rates/Pages/TextView.aspx?data=yield