[HLS]

Appraisal waivers do not seem to exist if the property value is $1M or more.
40% equity+ is generally the best pricing, so if the loan amount is below $600K, property estimate of $999K offers the best pricing AND a possibility of appraisal waiver.

The appraised value is ONLY used for the transaction.
In this situation, there is absolutely no benefit to pay for an appraisal whether the property is actually worth $1,000,001 or $10 million. It won’t change the pricing of the loan OR make it any easier to qualify.
An approval is an approval. There is no such thing as a stronger/better approval.

I’m sure you had to disclose other properties owned but if rental income is not needed to support them, then no tax returns should be needed.

For a cash out loan it is not the lenders business why you want the money, and many don’t ask.
If they do, the wrong answer is it will be used as leverage to create any additional debt.

Loan approvals are a silly puzzle that ALL pieces have to come together to be approved.
It can be easier for someone with crappy credit and no assets to buy a house with a 5% down payment than it is for someone with an 800 credit score and 50% with plenty of assets, Go figure. It’s a stupid system.

[HLS]

GZZ
Some lenders have additional overlays of what is required.
There is no pricing hit for self employed but probably requires current P&L

Regardless of what stage you’re in with a loan application, you are under no obligation to complete it.
Nobody can force anyone to sign loan docs.

I had a call today from someone who needed cash out and their existing servicer quoted them 3.125% with $7700 cost today.
I’m now doing it for them at 2.875% with zero costs.
3.125% sounded good, but the cost was ridiculous.

If you want a 2nd opinion, let me know.
There may have been a much better strategy for you, that I don’t know if you considered

[HLS]

I could possibly work that out for you based on today’s pricing. What’s the house value ?

Approvals and appraisal waivers are generated online. Individual lenders do not decide who needs an appraisal and who doesn’t.

I’ve seen appraisal waivers at 90% of the value and I’ve seen appraisal required when 40% of the value when I expected an appraisal waiver.

There is no one rate that fits everyone and pricing changes every day.

The basic factors are pretty simple:
Credit score
Loan Amount
House Value
Cash Out OR Refi existing balance
Primary Residence OR Rental property
****
The basic pricing tiers
Less than 20% equity
20-24.99% Equity
25%-39.99% Equity
40%+ Equity
************************
Self employed is the same pricing as salaried but more documentation needed for self employed.

The hassles today are solar liens & HELOCS but these can usually get worked out.

The more equity one has, the less credit score matters (to a point)

VA rates are amazing, approaching 2.25% for 30 year.
Effective last week, it is now MUCH easier for National Guardsman to qualify for VA loans

[HLS]

Depending on your loan amount, $300K+ the right pricing today for a No Cost 15yr refi is 2.25% and it should only take 2-3 weeks.
10YR ARMS are 2.50%
30YR Fixed 2.875%

Guidelines are in stone and there are generally no exceptions made for lower LTV’s or higher credit scores.

Approvals are via a computer program and are either approved or not approved.
There is no such thing as a stronger approval.
If assets are not needed, there is no reason to submit them.

If you have a clean situation, there is no reason for a refi to not go smoothly, unless you deal with the “flashy FinTech” 😉

[HLS]

Many lenders have already factored the .50% fee in to their pricing.
One major lender it starting today.
There are still several that have not added it yet, but will next week.

The .50% fee is not added to the interest rate, it is a pricing hit of .50, so on a $400,000 loan it is an additional $2000.
There will still be options for no cost loans, as it is built into the rate/pricing..
The Dec 1st date is a delivery date to FNMA, not a loan application or funding date.

It’s still possible to get no cost loans and save tens of thousands of dollars of interest over the life of a loan.

Refinancing is not a one time event. Regardless of what the Fed says, there still has to be a market for mortgage backed securities.

It’s crazy how many people still have mortgage rates above 3.50% and just don’t understand the benefit of refinancing either at zero cost or a small cost, and will waste literally tens of thousands of dollars over the life of their loan.
The objection that I hear most often is “I don’t want to start over at 30 years”
That’s when I know that they don’t understand their situation. OR those who think you need save at least 1% to make it worthwhile.
When you can save at least .25% at zero cost, it’s worth refinancing.
Sad that so many people don’t have a clue how much they are wasting
It’s no too late to save thousands 😉

[HLS]

Covid19 has added some extra conditions for self employed.
I’m a mortgage broker who can explain what’s going on and help you figure out what you may qualify for.
I’ll send you a message.

If income has been affected by Covid, previous tax returns don’t mean as much as they used to.
In some cases only 1 year tax returns are needed but you will probably need to provide YTD P&L with bank statements.

Many self employed who have been affected this year cannot qualify at the moment.
Having an office and employees doesn’t make it any easier or more official.

[HLS]

The 10yr bond might be a rough indication of 30yr mortgage rates for the average consumer but have nothing to do with rates in reality.
Mortgages are bundled and sold into mortgage backed securities for 30 years.
Regardless of where the 10 year goes, if there’s no demand to buy 30 year fixed rate bonds at low rates, mortgage rates will go up.
It happened quickly in March
If you can predict the demand for billions of dollars of 30 year MBS, that might be a better indication of where mortgage rates are going.

[HLS]

Those are the guidelines.
There are many others that make zero sense as well.
Underwriters are told to follow directions, not to think for themselves.

If you pay off the house then want cash out, it’s a cash out refi.
You cannot buy the house from yourself.
Freddie & Fannie make the rules which have nothing to do with common sense. Pricing hit for cash out

Your lower loan amount is what’s hurting you if you’re looking for a no cost loan.
Doesn’t matter if you have 80% equity.
There are costs involved with every loan, $500,000 loan fees aren’t that much higher than 160,000 loan.
Lender pays a % of the loan amount to cover the costs.
1% of 500k = $5000
1% of 160k = $1600

Some lenders have penalties for loans under $200K
I am working on one for a client now.
It was cheaper to get a $200,000 cash out loan than $160,000 without cash out. They will probably pay the extra $40,000 back towards principal quickly.
Although the payment won’t change, interest is only charged on the actual loan balance. More will go towards principal.

What are you trying to accomplish ?
Is a rate around 3.21 with $1000 cost or below 3% with a higher cost any interest ?
It’s either low/no cost up front with a higher payment OR pay up front and have a lower payment for the life of the loan.

Some people think paying up front is wasting money but
staying in a higher rate is wasting money too.

[HLS]

When doing a 1031 Exchange there’s a huge difference between making an offer with a contingency that you need to sell your property first VS.
having already sold your property and having the cash sitting with the 3rd party.
1031 exchanges can be very stressful with the time constraints.

[HLS]

Left messages on both numbers provided.
Thank you

[HLS]

A large Wholesale only lender came out with a program about a month ago called Conquest that was ahead of the market, with low rates ONLY IF you had not had a loan through them in at least 18 months.
The rates were “as low as” 2.50%, and many people saw ads and assumed this meant there was no cost. It was actually a buy down rate that would cost $7000-$10,000 to get 2.50%

They do not have a retail arm, so only available through brokers who deal with them, which I do (not all brokers do)

In the past month, the market has dropped and Conquest may not be the current best option for many.
There is so much confusion right now, Many people go a bank because that’s who they make their payments to, and are getting rates that are well above what they really should be.
Real rates change a bit every day and most people have no idea what they can/cannot qualify for.

Everyone know the #1 largest mortgage advertiser is and their rates are normally terrible, but they do the most loans.
I deal with their wholesale branch, and can offer extremely competitive rates that have nothing to do with their Retail rates.
It’s a different division.

The bottom line is that most people are paying too much in interest
and don’t realize how much they are wasting by not refinancing, whether they pay something OR have Zero cost

Another trick is people being told no cost, but some fees added in that they don’t understand.

[HLS]

I don’t have one rate that fits everyone.
It depends on equity, credit score and loan amount.

Conquest is AS LOW AS 2.50%
This rate is not available without a cost.
Yes I have rates below 2.75% with zero cost for certain scenarios.
I have a 2.70% at this moment.
It can change at any time, better or worse.

Having a HELOC or Solar lien complicates a refi.
Call me to discuss your situation. You have my info 🙂

Some of the low internet lenders are jerking people around.
I’m hearing some ugly stories.
One of them requires 50% equity for their lowest teaser rate.
Others don’t deal with self employed.

[HLS]

I am a Broker who offers UWM Conquest.
Not everyone can qualify and this program was something special a month ago, but there may be better rates available with other lenders that I work with, depending on your situation.

There are huge pricing hits for rental properties with EVERY lender.
Fannie Mae & Freddie Mac dictate pricing.
It’s possible to buy the rates down, but you can’t expect any
where near what primary rates are.
Please send a message with your phone number and a good time to reach you. HLS

[HLS]

Sorry, I was NOT referring to YOU as thinking you were God’s gift to a Lender…It was a general statement.
I can only determine that after talking to someone who thinks they are special, until I have to tell them that they don’t qualify.
Having an 800 credit score, with high income and only wanting a 50% LTV loan is not a guarantee that someone will qualify.

All of your debt enters into the process, rental properties, insurance & HOA on all properties etc.
Covid caused a problem for some with rental properties because they didn’t have enough reserve assets even though they had huge equity.
Another client could save a lot of money and is qualified & approved for a great interest rate, but his tenants won’t let an appraiser enter the property,

HELOCS are a 2nd lien against a property for the full amount of the line whether any of it is being used or not.
It really shouldn’t matter to a first lender, but the system requires it.
Having a $400,000 1st and a $100,000 HELOC is viewed as $500,000 of debt, rather than just $400,000 and can affect pricing.

Leaving a HELOC in place is possible, but requires a subordination, usually costs at least $250, and wastes several weeks.
It is definitely better to agree to close the HELOC completely and get a new one after the new loan funds.

Lots of ways to save so much money with minimal effort.
Saving a couple of hundred dollars a month is one possibility. but paying that couple of hundred towards principal every month adds up to a much greater amount of compounded savings, guaranteed to pay a mortgage off quicker.

I would not suggest getting serious tax advice here. Talk to a qualified tax advisor. You’re asking some serious questions

[HLS]

Why would you need to finish your tax returns ?
2019 tax returns are not needed at this time.
For salaried workers 2018 & 2019 W2’s are needed + 2 recent pay stubs.

I can tell you from experience that some people who think they are God’s gift to a lender have a difficult time when they get turned down for a loan. It’s a humbling experience.
Nobody should assume anything about qualifying for a loan.
The guidelines can be ridiculous, and are rarely negotiable.

Underwriters are told what to do and MUST get an automated approval. They don’t make decisions,they follow instructions.

At the moment, subject to change, a $500,000 loan with at least 40% equity and a credit score of 700+, 30Yr Fixed is 2.95% with zero cost. Nothing hidden, nothing rolled in.
15yr is 2.62%
with 25% equity and a score of 740+ 30yr is 2.99% no costs.
Not everyone will qualify for this pricing.
Lower rates available with a cost

Lower loan amounts, less equity, cash out, having a HELOC etc is different pricing. The more equity you have the less a credit score matters

[Author]

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