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

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

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!

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?

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

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? Purchase?

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)

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

Why Borrowers Should Not Pay Points to Buy Down Interest Rates

EVERYONE WHO PAID POINTS IN 2009 WASTED THEIR MONEY In 2009, when rates fell below 5% we refinanced our entire database and many borrowers wanted to pay points to buy down their rate. As a reminder – a “point” is 1% of the loan amount. Our borrowers wanted to pay points b/c: (1) they thought […]Read More

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

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

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

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?

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

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

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

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

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?

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

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

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

Home Equity Lines of Credit

Home Equity Lines of Credit are still available from most banks and some large Financial Planning firms – usually to 80% combined loan to value. We can offer these home equity lines of credit as well through U S Bank and a few other institutions, but we more often refer people to Schwab and Ameriprise […]Read More

Refinancing

It is true that refinancing has the potential to improve your overall financial picture, it is not necessarily a strategy that makes sense for every individual in every situation. So before you make a commitment to refinance your mortgage, it’s important to determine whether such a move is the right one for you. The most […]Read More

Possible Relief for Short Sale Process?

We just got back from a huge Asset Managers Conference in Fort Worth, Texas where we were actually featured speakers. Our topic: Don’t be afraid of FHA because it now allows “As Is” purchases, and because we control the appraisal process. We also touted “HomePath” financing for Fannie Mae owned foreclosures. One of the things […]Read More

Fed Conveniently Spends Another Trillion Dollars

The Fed announced yesterday that they will buy up an additional $750 Billion in mortgage-backed securities, as well as $300 Billion in Treasuries or government bonds. The debt markets responded positively and within hours of the announcement, interest rates dropped a quarter percent. This will not only spark another refinance boom, but it will also […]Read More