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Mortgage/Loan help

Discussion in 'Stocks, Investments & Finances' started by Voss, Sep 1, 2021.

  1. Mar 26, 2022 at 2:52 PM
    #61
    Voss

    Voss [OP] Dust in the wind

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    An update on the current mortgage market. Maybe some have heard rates are considerably higher now but figured an in-depth view on what’s taking place may help anyone wondering what’s happening.

    Since Dec mortgage rates have been on the rise. Most people look at the FeD rate hikes but those increases are nothing. They raised their funds rate by a .25bps(not .25% on rate, .25bps which for example would take a rate from 4% to 4.1% if that)

    What’s really impacting rates are the MBS(mortgage backed securities) and bonds the FeD has stopped purchasing. We’ve gone from around 2.625% in Dec to around 5% now and all signs point to even higher rates down the road.

    At this point, unless you have an adjustable mortgage, you should NOT refinance. I doubt anyone has a higher rate than current rates if their loan was taken in the last 5+ years.

    If you have a conventional loan and pay PMI, just continue making payments. As long as the PMI isn’t included in your interest rate, it’ll automatically come off once you’ve paid down your mortgage to 79% of your original purchase price.
     
  2. Mar 26, 2022 at 3:21 PM
    #62
    nobodyintexas

    nobodyintexas What?

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    Whatever this forum told me to do
    Thank you

    Your insight is appreciated
     
    Voss[OP] likes this.
  3. Mar 27, 2022 at 2:49 PM
    #63
    Haslefre

    Haslefre New Member

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    So I should wait to purchase again after I sell this house until interest rates potentially come back to earth...
     
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  4. Mar 27, 2022 at 3:13 PM
    #64
    fisherman951

    fisherman951 MT dreams

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    What are your thought on refi at the moment? I have a PMI and also want to pull out money to pay off debt. I figure since house values are so high it would make sense
     
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  5. Mar 27, 2022 at 4:49 PM
    #65
    belanger9

    belanger9 New Member

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    I'm in Canada so not sure if the states has the same mortgage rates/terms, but interest climbing happens the same on both sides
    Something I'm starting to think about is that in roughly 2 years I'll have to get a new interest rates - bought a 30yr mortgage, rate locked in for 5 years at which point I basically have to refi for 25 years at the new rate - so what I'm wondering is should I look into refinancing now and have to pay a penalty (not sure what it is, I'd have to ask) or just wait until the end of the 5 yr term and take what the market gives me?

    I get no one can perfectly predict the market (I've been waiting for a housing crash for about 5 years now) but would appreciate an opinion from someone who is plugged into the market and would have an educated guess on how much interest rates will jump in the next 2+ years
     
    Voss[QUOTED][OP] likes this.
  6. Mar 27, 2022 at 5:05 PM
    #66
    Tripleconpanna

    Tripleconpanna Just an X who bought Bud Light from Target

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    Credit Unions are usually the easiest to work with for these types of projects. They seem to have a little more flexibility and options for working through these types of loans throughout the project. If you are established w/one that's great, I'd check options w/them during the process. If you are not w/a credit union yet, shop rates, "products", etc. w/some in your area, and try to establish yourself w/your preference a little bit before wanting to begin your project.
     
    Voss[OP] likes this.
  7. Mar 28, 2022 at 10:23 AM
    #67
    Voss

    Voss [OP] Dust in the wind

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    Thats a question you need to answer yourself bud. No one knows what tomorrow brings and only you know what’s best for you.
     
  8. Mar 28, 2022 at 10:25 AM
    #68
    Voss

    Voss [OP] Dust in the wind

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    Depends what your rate is, if you have a FHA loan taken after 2014(I believe is when PMI of .8% stays with the loan forever) and how much debt you have.

    I’d suggest getting a few quotes from different lenders, comparing the #’s to see if it puts you in a better situation
     
  9. Mar 28, 2022 at 10:31 AM
    #69
    Voss

    Voss [OP] Dust in the wind

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    Im not familiar with Canada’s lending but your situation is why I always ask my clients to take 30yr fixed mortgages.

    That said, rates may rise and in 2 years may be lower than they are now. I can only speak to what I would personally do in your situation which would be to not pay a fee just to lock in a higher rate than I already have now. Seems like a lose lose situation at the moment to do so.
     
  10. Mar 28, 2022 at 10:35 AM
    #70
    Netmonkey

    Netmonkey Don't be a Dumbass

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    My wife and I lucked out with our refi. We initially got a conventional loan with 3% down, but then we also had to purchase PMI. In Texas, the PMI automatically drops after 9 years, but after 5 years (really from 2020-2021), the market value of our home doubled. So, we were easily able to drop PMI and lower our interest rate (it went from 3.785 to 2.785). Between dropping PMI and lowering the interest rate, the refi saved us about $350 a month.
     
  11. Mar 28, 2022 at 10:50 AM
    #71
    belanger9

    belanger9 New Member

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    Thanks, kinda along the lines I'm thinking too - just too volatile right now to see where it would go in the next 2 years.

    Right now in Canada a 5 yr fixed is ~4.99% depending on the bank, and a 10 yr is 5.89%, and a 25 yr is ~8.75% - so you can see why long term mortgages are not common here. I'm just glad I got a fixed mortgage and not a variable one, sure I would have saved up to 0.5% initially 2.5 years ago but it would be 2% higher now.
     
    Voss[QUOTED][OP] likes this.
  12. Mar 28, 2022 at 11:00 AM
    #72
    Voss

    Voss [OP] Dust in the wind

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    That’s awesome! Well done! A feel good story any mortgage originator would appreciate lol.
     
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  13. Mar 28, 2022 at 11:14 AM
    #73
    Netmonkey

    Netmonkey Don't be a Dumbass

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    well, we are happy that we got the refi, but the whole refi process was the worst experience ever. it took over 6 months for the refi to go through. stay away from NewRez.
     
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  14. Mar 28, 2022 at 12:00 PM
    #74
    Voss

    Voss [OP] Dust in the wind

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    Wow 6 months. Big banks and servicers like NewRez aren’t really great at completing a loan. My loans close between 3-5 weeks depending on documentation needed.

    The bigger banks don’t need licensed professionals working in their files so they hire just about anyone off the street which can lead to issues and complications.
     
    Last edited: Mar 28, 2022
  15. Mar 28, 2022 at 12:08 PM
    #75
    Netmonkey

    Netmonkey Don't be a Dumbass

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    yeah.. the worst part was waiting in between phases. for example, we had to get a credit check at the beginning (as expected), but they waited so long to process the refi that the credit check "expired". So they had to run a second credit check. That pissed me off.

    after the refi went through, they sent me a survey. they got all zeros.
     
  16. Mar 28, 2022 at 12:17 PM
    #76
    Voss

    Voss [OP] Dust in the wind

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    So basically they did nothing for the 1st 3 months. The reason for that is their employees(maybe not all big banks) get paid once an application is taken. Then they just stop working on it and move onto taking the next application.
     
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  17. Mar 28, 2022 at 12:21 PM
    #77
    Netmonkey

    Netmonkey Don't be a Dumbass

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    yeah, for the first 3 months, all that happened was me submitting documents. then i had to resubmit them all again once they started working on it.
     
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  18. Aug 11, 2022 at 1:54 AM
    #78
    MichelDoms

    MichelDoms New Member

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    Okay, so good I’ve found this thread. My wife and I managed to save a sizable sum, but it still isn’t enough to buy the house. We want a big house to raise our children (the first is coming in a few months). That’s why we need a mortgage urgently. However, I’m hesitating and think it would be better to hear more opinions. So what is the best bank for it in your opinion? I also heard that Equity Release Durham helps to pay less for a mortgage. Do you know anything about it? Many thanks for considering my request.
     
    Last edited: Aug 15, 2022
  19. Aug 11, 2022 at 7:42 AM
    #79
    Voss

    Voss [OP] Dust in the wind

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    There are 1st time buyer programs for both FHA(high Govt fee of 1.75 points & PMI which never goes away) and Conventional which require only 3.5% down(fha) and conventional 3% - 5% down.

    These days you don’t really need much of a down payment as long as your income/debt ratio qualifies for the payment.
     
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  20. Aug 11, 2022 at 7:50 AM
    #80
    GODZILLA

    GODZILLA Hail to the King, Baby.

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    That's good news and bad with the insanity of the housing prices. Good that you can get a loan, bad that prices are so high nobody can afford a sizable down payment anymore.
     
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  21. Aug 11, 2022 at 7:57 AM
    #81
    Voss

    Voss [OP] Dust in the wind

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    Indeed. Typically summers see the most buyers and the markets settle down a bit during the holidays.
     
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  22. Sep 7, 2022 at 8:13 PM
    #82
    Haslefre

    Haslefre New Member

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    What's the thoughts on rates in the next 6 months? We're looking at pre qualifying in December/Jan after we've had our jobs for 3/4 months (never really unemployed.. moved cross country is all) and buy in April or May.

    Hoping with today's rates it'll be in the 4%s... But I'm not sure that'll be the case.
     
  23. Sep 8, 2022 at 10:00 AM
    #83
    Kimosabe

    Kimosabe Slacker

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    I would say that rates are going to continue going up, the question is how much. I also think that it’s not permanent, but your guess is as good as mine on when they will start going down.

    Think about your goals and current situation. Is this your forever home, or a stepping stone? What's your financial situation like? Savings? Here are some considerations; solely my opinion. I would compare rates and payment and see what that looks like. A 10/1 ARM might offer a lower rate with the option to refinance once rates start to go down. A 30 year fixed might be less stressful and you're locked into a payment you feel comfortable with.
    If it's a forever home, then you can usually justify the long-term cost by not having to worry about housing, and knowing it will appreciate in value. If it's a stepping stone, then minimize your cost with the lowest rate, knowing you won't be there for long.
     
  24. Sep 8, 2022 at 10:59 AM
    #84
    Voss

    Voss [OP] Dust in the wind

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    The Fed has stated they’ll continue raising their benchmark rate well into 2023 and this month they’re set to DOUBLE the selling/winding down of bonds and Mortgage backed securities(MBS) holdings which has an even greater impact on mortgage rates than their benchmark rate increases.
    They’ve also stated they’ll continues increases the size of reducing their bond/MBS holding going forward.
    If the Fed holds true to their intended path forward, rates will continue rising well into 2023. I wouldn’t be surprised to see 8% mortgage rates within a year if they stay on the same path. I’m telling my clients who want to buy to wait. I’m personally eyeing 2024/a Fed pivot before considering buying again.
     
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  25. Jul 26, 2023 at 5:33 PM
    #85
    MedCityMoto

    MedCityMoto SciTech Nerd

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    Today's rate is 7.8% 30-year fixed - so far this threads predictions are close!
     
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