So higher rates are a thing...
Just a quick update to all my fellow short term, multi unit or property investors in general..
I've been working closely with both investor specific mortgage brokers and local credit unions on in house portfolio loans for pre-qualifications of several purchase clients.
With 800+ credit, second home, full documentation, 20-25% down for either a conventional $550K PP or Jumbo $2M PP the quoted rate on a conventional 30 year mortgage was 7.875% & 10.25% respectively!
There are more creative options available in this stratosphere at or around 6.5% but just an illustration of how historic the acceleration and deterioration of readily available cheap credit has occurred. I'd imagine in January 22 the rate was closer to 5.5%..
I anticipate a complete stall of the luxury real estate market except for those transactions needing or wanting to transfer or liquidate assets and can afford cash purchases at much more reasonable price points. Entry level first time home buyers and conventional affordable rental properties will continue to see demand albeit with considerably less purchase competition and activity.
We are firmly in the first innings of a transition to a buyer's market and the rebalancing of asset valuations.
Highly suggest a real estate professional with background and experience in seller financing and other creative financing solutions..for example how does 25% down at 5% interest only for 5 years sound? $375K PP Closed 10/12/22...
Thoughts on this?
If anyone has any lender specific programs for jumbo/super jumbo or second home purchases, you're up...
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Real Estate Agent California (#02071578) and Oregon (#201231202)
- 541-800-0455
- https://anthonywong.fathomrealty.com/Oregon-coast-vacation-rentals
AJ,
Those rates are high in comparison to other banks especially if you compare them to a Fully Delegated Banks Portfolio Program. Depending on the the occupancy type if you are talking about Second Homes, or Investment properties the down payment should be 5% for Second Homes 95% LTV and 85% LTV with 15% down for SFR or (2-4 Unit) multi-family rental purchases.
A true Portfolio rate is actually 2-3 point's under what you have listed above. Those rates lean a little more towards Non/Qm and lower fico's scores. Unless your pricing with a mortgage broker, mortgage lender then they are accurate. A bigger FDIC bank that offers a true portfolio is well under that rate margin and much lower in down payment in order for the portfolio to be a NICHE program.
@Jason Wray who are you utilizing for your portfolio loans? Feel free to DM if you would rather talk privately.
Quote from @Jason Wray:
AJ,
Those rates are high in comparison to other banks especially if you compare them to a Fully Delegated Banks Portfolio Program. Depending on the the occupancy type if you are talking about Second Homes, or Investment properties the down payment should be 5% for Second Homes 95% LTV and 85% LTV with 15% down for SFR or (2-4 Unit) multi-family rental purchases.
A true Portfolio rate is actually 2-3 point's under what you have listed above. Those rates lean a little more towards Non/Qm and lower fico's scores. Unless your pricing with a mortgage broker, mortgage lender then they are accurate. A bigger FDIC bank that offers a true portfolio is well under that rate margin and much lower in down payment in order for the portfolio to be a NICHE program.
Happy to provide a few client profiles. If terms are decisively better I have a quintuplet of well qualified clients looking for second home purchase in Oregon.
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Real Estate Agent California (#02071578) and Oregon (#201231202)
- 541-800-0455
- https://anthonywong.fathomrealty.com/Oregon-coast-vacation-rentals
For $550k PP putting 25% down, I see 7% for a second home.
With 20% down, 7.375%.
For $2M PP with 20% down, I am seeing 8%.
For $2M PP with 25% down, I am seeing 6.5%.
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Lender Texas (#2448506), Louisiana (#1039511), Georgia (#1039511), and Florida (#1450514)
- 619-456-8311
- https://helm.mortgage/
- [email protected]