Rental Property Investor · Newport Beach, CA · Member since 2017 · 218 posts · 138 votes
Hey BP! I'm sure everyone is actively watching the news and their impact on mortgage rates.
I'm personally losing sleep wondering if I can save more by waiting, or should I just lock in the rates today.
For those of us with loans that are well above market rate, the question of the day is: Will rates continue moving down from here? Or should a person refi immediately?
Second question that I think would help everyone: if you just got a quote, what was the rate, LTV and lender?
Rental Property Investor · Grand Prairie, TX · Member since 2018 · 2k+ posts · 2k+ votes
7y
@Sean McCluskey
I did a cash out refi on a SFR I own outright in June. My rate for a 15 year loan was 4.125% with 1.9 points. Took 4 weeks to get the cash. Not great, but not bad for an investment loan.
Developer · NY/NJ/PA · Member since 2018 · 758 posts · 935 votes
7y
Also anyone who is looking to refi or purchase a primary, if you have a large banking relationship (or start one) with any of the large banks, they will bend over back for you on your mortgage.
I know this is a dumb question, but are you even allowed to do a CO Refi if you would end up with a HIGHER rate than your current one? I have roughly $300K in equity on my primary but the rate is 3.625%. I'm assuming any CO I got would have a higher rate than that. Thanks in advance!
Lender · Orlando, FL · Member since 2019 · 15 posts · 3 votes
7y
Not a Dumb question! Yes you are still allowed to do a CO refi because the net benefit to you would be the cash you're receiving even if the rate increases slightly.
Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
7y
@Sean McCluskey We just closed on a duplex two days ago under our LLC. 20% down payment, 4.6% interest amortized over 25 years, 10 year balloon. Local bank that we've done business with previously. We also do not escrow taxes and insurance, so that money isn't sitting dead in the lenders account for 6 months at a time.
Personally, I'd lock in now if I had a property under agreement.
I know this is a dumb question, but are you even allowed to do a CO Refi if you would end up with a HIGHER rate than your current one? I have roughly $300K in equity on my primary but the rate is 3.625%. I'm assuming any CO I got would have a higher rate than that. Thanks in advance!
It's incredible how wide the variation in quotes can be for the same borrower. I got a quote from a popular internet lender, they tried to get $10k in points (1.6 points) for a 3.99% rate on my primary residence! 80% LTV, 780+ FICO. Crazy talk.
Then I talked to my primary banking relationship, and they said if I was able to lock today it would be 3.3%, but they need a full underwriting and can't finish it until Monday. Now I'm holding my fingers crossed.
Going to call a mortgage broker back as well, who seemed very honest, and see what she can put together from the market.
Flipper/Rehabber · Johnson City, TN · Member since 2017 · 30 posts · 10 votes
7y
@Sean McCluskey
We are doing cash out refi with our local credit union. 4.5% 10/5 Arm 25 yr Amortization. Was super happy. Locked in a week or so before feds cut rate so now wondering what it would have been if I had waited a bit.
Rental Property Investor · Newport Beach, CA · Member since 2017 · 218 posts · 138 votes
7y
@Adam Kay I think that these rate cuts are already being priced into the forward yield curve. The real question is, will the new larger spread between the 10 year treasury and the mortgage backed securities that our individual 30-year mortgages feed into, remain in place? Or, will MBS yields chase the 10-year treasury downwards when fixed income investors start looking for yield again?
I'm betting that the spread maintains itself longer than I want to wait, as fixed income investors currently want to lock in safety and the MBSes already traded on the market are going to be faced with substantial refi prepayments (which no new MBS buyers would want to receive right now, without a place to reinvest the proceeds).
South Jersey, NJ · Member since 2014 · 154 posts · 50 votes
7y
Yup, my 3.8% quote was for primary not investment.. I’m seriously getting so tired of the incompetency of the people in the world. It feel it’s a constant battle trying to make sure someone else’s stupidity doesn’t interfere with my success. True rate 4.5%... skipping the cash out, going to raise hell for standard refi since I didn’t bother shopping around when I heard 3.8. I’m hoping for 4.25 or less for standard refi with recent drop in 10 year.