[quote=sdrealtor]I knew exactly how the new construction tract would turn out. The area was booming and about to take giant leap forward in desireability which it has. There had been little to no new construction in this range in my area in almost 2 decades. There was huge pent up demand for newer homes between 2000 and 3000 sq ft which was obvious to me. When I bought the price of a 20 yr old resale less a mile away in dire need of updating was selling for the about same price. those homes were smaller and bordering on functional obselescence. Those sales comps more than justified our price. We got the nicest recreational amenities in Coastal North County for about the same HOA fees that the older neighhborhoods paid for minimal facilities. We had a brand new elementary school being built in a neighborhood that was sure to be a magnet for young professional families. That school now ranks among the top 10 in the county.
As for the asumable feature it doesnt seem to be worth much anymore. The buyer still has to qualify to assume it. Why would a buyer want an adjustable loan when they can get a fixed loan for the same rate and minimize risk. Assuming yours they would have to have a big down if you have equity and/or take out a 2nd loan at a higher rate also. It doesnt make sense unless rates skyrocket which i dont think they will.
I keep my HELOC because I earn a higher return on the assets I have to pay it off. If that changed I would liquidate those assets and pay it off. Sorry, no risk there at all.
If you are certain you are moving in a few years why not go for 5/1 or 3/1 arm with rates in the low 2% range? You could make additional princincipal payments with the savings and pay your balance down even faster. I think I know why. You have stated many times you cant qualify to refinance because you cant document income. Why are you singing another tune now?[/quote]
What is the interest rate on your student loan, sdr? Why don’t you pay that off with your HELOC so it doesn’t follow you to your grave and become a claim on your estate??
Actually, that was last year that I didn’t think I could qualify. I CAN document my income now. I would only be looking for about a 60% LTV mtg so I wouldn’t really need to apply for a full-doc loan anyway. My perfect payment records on this and other mtgs is testimony to how they will be paid, since the payment on a 3% mtg will no doubt be less than what I am currently paying (partly due to going back to 30 yrs). But why rock the boat?
You never answered the questions if YOU would refi a 4% adj (to another product and pay the costs) OR if you thought rates will rise significantly in the next 3 years.
I’m waiting for an “expert” opinion, here :=]
I have a major problem with rising closing costs of late. I closed this mtg for <$2800 out the door. That paid ALL my purchase closing costs. Most of these lenders today have a lot of garbage charges I wouldn't agree to and recording charges, for instance, have quadrupled since then.
I see the assumable mtg as valuable. I see one of my neighbors buying it for their kids and grandkids to live in. The "kid" will end up assuming the small loan and there won't be any origination costs or points. That's how things work around here.
