All Forum Posts by: Pavan K.

Hey BP family,

In the process of putting in offers for a SFH, with a primary residence loan. Will be my first ever home here in Dallas Fort Worth, but I've lived here all my life and feel that it's my competitive advantage knowing the ins and outs of a majority of the metroplex. My plan is to buy the home, live in it for a year, before renting it out. Standard 3/2, 1750-2,250 square feet.

I came across a website called Niche.com, and it tells you a little bit more about the demographics of an area, and one thing specifically it told me was about the percentage of people who rent/own in that zip code. This may be a really naive question, but it got me thinking, is it more attractive to a rent a home in an area where most of the surrounding area owns? Or via versa? 

Does it even matter at all? I saw a zip code where almost 85% of people (assuming the data was correct), owned their home and I just wondered if having a rental property in that neighborhood is a good idea. 

Thanks for any help on this! 

@Pavan K. this makes NO sense. 

I am betting you used builders agent for everything and not your own, correct? 

I, in same market, am down in 5's for rate and no pts. High 5's but still. And yes, rare but just happened to cross that line a couple weeks ago. 

Everything else new-con is in 6's, again no pts. 

So 7 + pts, I call BS, someone playing shenanigans somewhere. 

And again, that's same market, I am here in Twin Cities doing these live-time. I suggest digging deeper into the details of what you got going on. 

And yes, I also have builder free-bee's added in, builder paid closing etc etc.. 

If rate was in 7's and no pts I'd maybe let it slide, but add in the pts, it's a "WTF" moment. 

I closed on my investment property November 2023 and my rates are almost the same. 7.75% and paid a couple points to bring that down. But since this was a new build, I was able to have the developer pay the closing costs, including some extra upgrades done on the property. 

Your numbers are similar, but I have been reading the rates should be dropping a little by end of 2024. I would keep my eyes on it, and when the time comes, refinance to a lower rate and add some more cash to the deal to bring down the loan.

Unfortunately for me, in my position I am not able to pay it all off. I was able to put 35% down but need to put another 10% to make a monthly profit. 

Perhaps you could clarify if this is a larger builder that actually owns the mortgage lender for us to better understand the question. For instance, most track builders build in a crap-ton of fluff into the price of the house so they can provide a "credit" (like $15K or more) toward closing costs if and only if you use their lender...where they can charge whatever they want. They can stack even more fees into the Loan Estimate and jack up the rate to make even more in back points. They get away with it because, technically, they are the seller. It's BS, but it's how many of these track builders work. We run into it constantly. 

@Rahul Tripati I just got 7.75%.

 with a Sept 24 closing date what rates are today are basically irrelevant. Shop when you can actually lock. 

Hi Rahul,

Was this a business purpose loan, like a DSCR? If so, this seems about what most lenders would offer. You could get better rates if you get a conventional financing.

Back in September when rates were higher DR Horton was 6% for a rental property plus 1.5% towards closing. They sold out 60 unit complex in 4 months. ($500-$620k SFR) Your builder must have plenty of buyers lined up to charge that much.

Try a local credit union, local bank? As mentioned you could move in for a year, you might save more than you could collect in rent.