Any recommendations on 30 year or arm loans with low rate from bank or credit unions?

[Jin Zhang]

Hi everyone, 

I am currently looking for a loan either 30 year fixed or arm loans with good rate. I live in the Bay Area and am looking into purchase an investment property in Southern California or out of states. Do you have any recommendations? 

Thanks,

Gin 

[Doug Smith]

What do you deem to be a "good rate". The CA market is quite different than the rest of the country right now. With housing prices much higher than most areas and a very, very high net negative migration, CA is tough. The answer will be very different for owner-occupied and investment real estate loans. When I was a banker, we were brainwashed into thinking that investors were unwashed, bottom-feeding con artists who could not be trusted. Just look at me now! The FDIC and other regulators HATE loans for investment purposes to smaller investors. The 10-Year Treasury has been tracking upward, so rates have climbed a great deal over the past few months. According to Mortgage News Daily, the average 30-year fixed rate loan for an owner-occupied home in the nation is 6.92% as of the time I type this (I'll add the screen shot below). Gone, at least for now, are the days of 5% rates. You'll need to add a risk premium to that rate for investor deals. They are hovering around 8% for a longer-term investor deal right now. I did lock one sub-8% a couple of days ago, but most are hovering around 8%. Banks and credit unions will be a decent place to go for loans for smaller investors only if that investor has other business with the bank that is significant. One of my customers, for example, owns a chain of medical centers and has an average deposit balance with them North of 7-figures. They'll give him loans, but most investors that ask for investor loans will get they "eeeww, we don't do those loans." I'm not sure if that helped, but I hope it did.