DANGER! Home Equity Lines & Inflation

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A borrower reached out to me for a Home Equity Line of Credit (HELOC) recently, and I referred her to a local bank that we work with that offers the best service and rates. She came back to me the next day and said: “my friends say I should consider a cash-out refi instead…” And […]Read More

6 Reasons Why Refis Are SO MUCH EASIER Than Purchases

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We often see borrowers who are reluctant to refinance into a lower rate – even when the new loan will be “no cost” and save them hundreds of dollars every month. Unfortunately, this reluctance is sometimes fostered by the stress those borrowers endured during their purchase. As a result we like to emphatically remind everyone […]Read More

Student Loan Cash-Out Refinances

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Millennials are one of the largest demographics and have taken the housing market by storm. Millennials accounted for 38 percent of home purchases in 2020 and more than half of all new mortgages. Yet, while millennials make up a sizeable portion of the housing market, over 45% of millennials have student loan debt. For homeowners […]Read More

Recasting Or Re-Amortizing After Paying Lump Sum

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QUICK ASIDE: NEED FOR SPEED REQUIRES COOPERATIVE ESCROW OFFICERS 😊 A frequent cause of delays for us is slow escrow officers who sometimes get openly hostile when we request info or documents in a timely (under 24 hours) manner. This is a quick reminder that we need escrow officers who are fully committed to speed […]Read More

Your Home Just Appreciated 25% – Now What?

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Home values in the U.S. increased an average of almost 12% over the last 12 months, according to Zillow. But, in some markets – like Austin, TX – we saw appreciation of over 25%! Dallas saw almost 11%, while Sacramento saw 15%. Poor San Francisco was the outlier with DEPRECIATION of almost 3%! So – […]Read More

There’s A HUGE GLUT OF WOOD, So Why’s Lumber So Expensive?

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On Friday, I blogged about whether or not borrowers can roll their closing costs into their loans. Several savvy agents responded and pointed out that I forgot one more way borrowers can get credits for closing costs: agents can credit a portion of their commissions too if they so desire.  We never recommend that to […]Read More

Refi Boom Over? Record Appreciation; Affordability Crisis? Not Here

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PANICKED LISTING AGENT; PURCHASES HARDER THAN REFI’S I got this text last week from a panicked listing agent: “Jay, my listing is supposed to close Friday and the lender went MIA; how fast can you close?” I get texts and emails like that all the time, but have been getting them slightly more often lately, […]Read More

Why Refi Into A Higher Rate? Debt Consolidation!

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BORROWER REFIS INTO HIGHER RATE We recently had a borrower who had over $110,000 of consumer debt (credit cards and personal loans). The borrower had a very low fixed-rate mortgage too that we could not match b/c rates have gone up and b/c the borrower’s credit score had dropped so much b/c of the consumer […]Read More

Tax Implications From Refinancing; Cash Out ≠ Income

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Borrowers are often far too worried about tax implications from refinancing – b/c they are usually negligible.  APPRAISALS & PROPERTY TAXES No matter how high someone’s appraisal comes in (over the original purchase price), it will not affect their property taxes. This is b/c appraisals performed for purposes of obtaining financing are for lenders only […]Read More

Why Refi Interest Rates Are Higher Than Purchase Rates

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Every day in my blog I quote an interest rate for a “no points” purchase money mortgage, and today is no exception (at the bottom of the blog). This, however, sometimes fosters confusion when borrowers read my blog and then come to us for a refinance b/c the rates we (and all lenders) quote for […]Read More

“I’m 8 Years Into My Loan & My Rate is 3.625%, Should I Refi?”

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JVM: READY FOR REFI’S! First and foremost, JVM is open and ready to take on ALL refinances again! We had to temporarily shut them down last summer simply b/c we locked in so many that we swamped our system. But, now that we have cleared out our pipeline, aligned with a new (much faster) mortgage […]Read More

Why “Now” Is Always The Best Time To Refi; Jumbo Returns :)

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GREAT NEWS – JUMBO HAS RETURNED! As expected and hoped for, one of our best jumbo investors returned to the market today with far lower rates. We are now very close to where we were prior to the COVID-19 crisis. WHY “NOW” IS A GOOD TIME TO REFI – IT IS NOT JUST B/C WE […]Read More

Why Are Refi Rates Higher Than Purchase Rates? Can Borrowers In Forbearance Refi – Yes & No

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I blogged Monday about our Refinance FAQs, and it is already one of our most frequently viewed web pages – indicating how badly borrowers wanted this information. So, I once again recommend sharing this info with friends, family and clients. I received a lot of feedback from the blog too and am highlighting two questions […]Read More

Refinancing FAQs; Essential Info for EVERY Borrower

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With rates this low, $4 to $5 trillion of mortgages are now eligible for refinancing. This is more than twice the mortgage industry’s annual capacity and rates look to stay low for some time. Because refis are now such a hot topic and will continue to be for months (if not years), we recently added […]Read More

The “No Out of Pocket” Scam; Worst Advice Ever!

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Borrowers often send us refinance proposals from other lenders to review so we can either beat the proposal or give our blessing. One of the things that always scares us the most is this phrase: “there will be no out of pocket costs…” This often means the loan officer is charging outrageous fees and just […]Read More

5 Bold Predictions For The Post COVID-19 World; COVID-19 Updates; Reason to Refi

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Forbes Publisher, Rich Karlgaard, published 5 Bold Predictions for the Post COVID-19 World. He imagined what we might see by the Spring of 2021 and predicted the following: A rebounding world economy with a fantastic global growth rate of 4%. Fully resumed global travel b/c human nature makes people want to travel no matter what. […]Read More

Rates 1/2 Percent HIGHER Than On Monday; Early Pay-Off Penalties

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Mortgage Interest Rates remain a full 1/2% higher than where they were on Monday, and 5/8% higher than where they were last week. So, while the 10-Year Treasury Bond (government debt) remains in record-low territory, mortgage rates are up considerably as the industry tries to stem excess volume. EARLY PAY-OFF PENALTIES – HOLDING ON TO […]Read More

Rates Keep Falling; 15-Year vs. 30-Year Fixed-Rate Mortgages

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Rates continue to fall in response to coronavirus concerns. They hit all-time record lows again today, as the entire mortgage industry scrambles to handle the influx of refinances. Don’t take the 15-Year Fixed! Take the 30-Year Fixed – Please! When rates move this low, borrowers often ask if they should opt for a 15-year mortgage […]Read More

The Myth of “Starting Amortization Over” When Borrowers Refinance – Save the Savings!

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I received the below email from a borrower this week: “I’m about 3 years into my current loan, and am looking into another refi. My monthly payment savings will be about $400 per month. How do you figure out the savings overall when you consider a new loan will cost about $80k in additional interest […]Read More

Cash Out Refis – What, Why, When; Rates?

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Reminder: Owner Occupancy Ratios in condo complexes are irrelevant if a buyer intends to occupy the unit. Owner Occ Ratios can be as low as 10% and Fannie or Freddie will still finance the unit. FHA and investment purchases, however, require owner occ ratios to be over 50%. CASH OUT REFIS Almost 90% of all […]Read More

HELOC vs. Cash Out; Fed Cuts Fed Funds Rate

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Borrowers in need of cash often wonder if they should get a Home Equity Line of Credit (HELOC) or if they should just refinance into a larger first mortgage with “cash out.” The answer is “it depends.” HELOCs are usually tied to Prime Rate, which has been at 5% for several months and will likely […]Read More

Do Borrowers Get to “Skip” a Payment When They Refinance?

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NO COST DOES NOT MEAN NO “CASH TO CLOSE” Almost all of our refinances are “no cost” loans, meaning that we, as a lender, cover all of the “non-recurring closing costs” (title, escrow, appraisal, underwriting, etc.) with our commission or rebate. Borrowers often get confused though b/c they interpret “no cost” as “no cash to […]Read More

Delayed Financing (Paying Cash & Refinancing After Close)

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With so many cash-rich buyers in our California and Texas markets, we want to remind everyone that “Delayed Financing” is sometimes a great option for buyers. Delayed Financing is a conventional financing provision that allows “all-cash” buyers to immediately do a cash-out refinance after an all-cash purchase closes. The advantage for buyers of course is […]Read More

Cash Out Vs. Rate & Term Refis – What’s The Big Deal?

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Prior to the 2008 meltdown, as much 90% of all refinances were “cash out,” meaning borrowers increased their loan amount with almost every refinance. That percentage has since dropped to about 50%, as borrowers are more conservative nowadays and they don’t want to incur the extra cost associated with cash out refinances. Borrowers are allowed […]Read More

Beware of Lending Delays; Layoffs & Unexpected Refi Boom

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2018 was an absolutely horrific year for the mortgage business. Interest rates were up significantly, all but wiping out most of the refi business. And overall purchase volume was down to boot. As a result, there was massive over-capacity in the mortgage industry so everyone started to compete with lower interest rates to maintain market […]Read More

When Does It Make Sense to Refinance? Rules of Thumb

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When I was researching today’s blog, I came across a December of 2010 blog of mine that said: “The refi boom is officially over.” I found that amusing b/c rates were about 1/2 percent higher than they are today, b/c rates fell almost a full percentage point in 2011, and b/c we have had so […]Read More

$5.4 Trillion of Home Equity; How To Tap It? HELOC or Cash Out Mortgage?

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CONFORMING AND FHA LOAN LIMITS This is a reminder that Conforming and FHA Loan Limits are up for 2018.             $5.4 TRILLION OF HOME EQUITY A recent article in The National Mortgage News reported that there was $5.4 trillion in home equity in the U.S. in 2017. $3 Trillion of […]Read More

More Purchase Tips For Refi Guys; Giving Away JVM’s Playbook

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On Friday, we provided tips to help refi guys close purchases now that rates are up. The tips included rush appraisals; reviewing contracts for addenda, reports and condition issues; and hiring a skilled appraisal manager. Several people, however, chastised us for “giving away JVM’s playbook.” We responded by saying: A. We always like to help; […]Read More

Timing The Bottom for Rates? Get While Gettin’ is Good; Refi Again

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Borrowers often ask us if we think rates will fall further before they lock, or they want to “time to the market” and lock in their rate at the “bottom.” As a result, they are sometimes reluctant to lock or get us their paperwork. This in turn delays purchase transactions, and sometimes causes borrowers to […]Read More

“Delayed Financing” Option For Refi After Cash Purchase – 90 Days

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One of our buyers is having difficulty getting offers accepted so he decided to offer “all cash” and then finance the property immediately after close via “Delayed Financing.” The Realtor’s questions about this reminded me that I had not blogged about it for some time. Delayed Financing is a conventional financing provision that allows “all […]Read More

Must Wait Six Months From Purchase For Higher Appraised Value

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We often have borrowers buy under market value or buy in quickly appreciating markets. They always ask how soon they can refinance into a better loan when their loan-to-value ratios improve. Lenders almost always correlate values to the purchase price for six months. This means that buyers need to wait six months before they can […]Read More

Refi Boom; What It Means?

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Rates dropped again this morning to shockingly low levels not seen since early 2013. A lack of inflation, falling oil prices, weak economies, stock sell-offs, and other factors are all working together to push rates to amazingly low levels. This will affect turn-times at lenders everywhere as no lender was prepared for a surge in […]Read More

Refi Options Now Better Than Ever; Values Up; Rates Down

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With values higher than they were a year ago (especially in certain areas) and with rates shockingly low once again, every buyer who puts down less than 20% should evaluate refinance options. We are of course more than happy to conduct free analyses for everyone. We analyze current estimated property values, current available interest rates […]Read More

No Cost Refi = No Risk = No Prepay Penalty = Savings for Free

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We have many borrowers with Mortgage Insurance who qualify for “no cost” refinances that would save them as much as $500 per month in some cases. These borrowers are “ripe” for refinancing b/c their homes have appreciated rapidly since their purchase date. We of course contacted these borrowers and explained the benefits of a refinance, […]Read More