[quote=Nor-LA-SD-guy]Mine is assumable I think (would need to double check but I remember that being part of it)
At 4.78 fixed that would be a nice loan to assume when rates hit 10%[/quote]
Wow, Nor-LA-SD-guy, you must have a very “seasoned loan.” I don’t recall any fixed-rate assumable loans ever being on the market except for the VA program.
All my loans in the last 22 years have been tied to the “COFI” index, which as of May 2010 was 4.609% (with 2.75% margin added).
I prefer this loan index (FHLBB 11th Dist. Cost of Funds in CA). My terms have been: 2.4% – 2.75% margin, 2% annual cap and 10.5% life cap. IMHO, there is NO COMPARISON to the ease and low cost of closing ($1800 – $2800) in the past and ($50 – $500 assumption fee) in the past.
I have never cared about the Neg Am or the Payment Option provision as I have always paid the fully-amortized rate and am/was happy to do so. COFI has been very good to me in the past and in fact has been going down every month for the better part of the last three years (currently 4.609% w/margin added). If my current loan is ever assumed, it would only cover about 50% of the purchase price (as EconProf previously stated). Based on the fact that persons who typically buy on my block do so to live walking distance to other relatives, it is entirely possible that a buyer would want to assume my loan if my bank accepts them and get help from their relatives for the other half of the purchase price 🙂
I keep getting solicitations but have absolutely no incentive to waste $4K to $9K refinancing to a “fixed-rate” loan product as I refuse to pay lender “garbage charges” and COFI loans did not have them. They came with a very straightforward and clean Reg Z and Hud-1.
I do not see rates hitting 10% unless all h@ll breaks loose (not to say this COULDN’T happen) LOL! If I foresee this coming, I guess I would put my property on the market immediately and if it should sell, I would rent until I turn 59.5 years old, at which time I would again purchase property to live in if rates and terms allowed me to. If my place didn’t sell, I would probably have to take in a “roommate” :{
Well, guess I should mosey on over to that “sister-thread” about the coming “economic collapse” and see what the doomsdayers are predicting for next year – LOL!
