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HLS
ParticipantThis SPECIFICALLY tells you how to deal with repairs
under CA law:
http://www.dca.ca.gov/publications/landlordbook/repairs.shtmlParticipantThis is absolutely idiotic on the surface.
There’s probably a hidden agenda as to why they are doing it this way.Fannie/Freddie do not own these loans, they guarantee them.
Mortgage backed securities (such as GNMA’s) were sold that hold these loans.The sensible plan would be to sell bonds at today’s rates
and pay off the existing bond holders, leaving the principal balances the same but lowering the interest rate to the homeowner.Many of these existing loans from 10 years ago could be at 6%-8%.
Lowering rates to <4% would drop payments substantially with no need for reduction in principal.
Most people dont care how much they owe. If their payment dropped 25%-50% most people aren't going to default.The net result is that Fannie/Freddie would still be on the hook for the same amount and any losses and it makes more sense than writing down principal to people who haven't paid.
The bondholders will receive their money. The reduction will come from Fannie/Freddie. It doesn't make sense.
(I don't know if Fannie/Freddie pay taxes on their profits but if they do, any losses would offset their profits and lessen their tax liability)
ParticipantIt’s all by negotiation.
Is property manager a licensed real estate agent ?
(They do not have to be a Realtor)Getting 5%-10% of the monthly rent to manage.
Screening/finding a new tenant could be anywhere from a flat fee to 50%-100% of one month’s rent for signing a 12 month lease.
it’s all negotiable. Not a conflict for agent who lists to also be the PM.
Many rentals don’t get listed in MLS.Do you have a lease OR are you month to month ?
Does your rental agreement address maintenance issues ?Tenants in CA have a lot of rights. Many property owners or their agents do not know the laws.
Cosmetic issues/wear & tear may not need to be addressed.
**Safety concerns, code violations & habitability issues do. Tenant is also entitled to appliances that work and ‘quiet enjoyment’
What kind of work are you asking to be done ?Whether you mail your rent check, direct deposit it OR pay in cash makes no difference.
For certain repairs you may be allowed to have the work done and deduct it from your rent payment if they refuse.
CALIFORNIA LAWS:
http://www.dca.ca.gov/publications/landlordbook/index.shtmlJanuary 4, 2016 at 11:29 AM in reply to: Starting 2016 by Ditching the Serial Refinancing Persona #792963ParticipantStated correctly, there is no such thing as a FREE loan but there are NO COST loans.
A no cost loan has no hidden costs, there is nothing added to the loan balance. All 3rd party costs are covered by a credit from the lender and it’s that simple. It’s not a trick and it’s not a gimmick.
It’s 100% inaccurate to say that there is no such thing as a no cost loan
Strict Regulations require that mortgage brokers show all cost/fees AND the credit from the lender that covers them.
(A bank or direct lender does not have to show these figures)Could you get an even lower rate by paying something up front or adding to your loan balance?
YES, but it often has a 5 to 10 year payback period and up to the borrower to decide if it’s worth it. That’s a different discussion than whether no cost loans exist & it doesn’t require a spreadsheet or Finance 101 skills to understand a no cost loan.Also, a no cost loan at a lower rate is NOT a no brainer without understanding your payback terms.
It can end up costing you more even at a lower interest rate!One needs to fully understand how they are benefitting from the refi.
You just need an explanation that allows you to understand the benefits.It can be made way more complicated than it is.
January 4, 2016 at 9:11 AM in reply to: Starting 2016 by Ditching the Serial Refinancing Persona #792958Participant[quote=harvey][quote=bewildering]My first refi was to 4.0%, but the rates that day were 3.9%. [/quote]
So your “no cost” loan cost you 0.1%
There are scenarios where one can come out slightly ahead in cash flow if they take a “no cost” loan and pay if off before the full term. But then there is the opportunity cost of paying off a low-rate, long-term loan early, which the “pay off my mortgage early” crowd always ignores.
And any mortgage broker claiming that a loan is “no cost” is just plain misleading…[/quote]
There are facts and there are opinions.
The FACTS are simple:
1. A no cost loan IS a no cost loan, it’s not misleading and can be explained properly.
2. It’s always better to have a lower interest rate on any debt.The problem is that most people don’t understand the options associated with NO COST refinancing and turn a beneficial refi into a worse situation.
You completely misunderstood (and twisted) what bewildering said.
Based on facts, I can make 100% guarantees about future payments, projections and cash flow if people listen to explanations and follow through.
There are multiple ways to benefit from a refi and if one only makes the minimum payment and resets the term to 30 years, it may not be a better loan.
HOWEVER, this is a choice by the borrower.Refinancing to a lower rate at no cost is ALWAYS a better situation for the borrower. There is no payback period or spreadsheet required.
The confusion is that most people don’t get a proper explanation about the choices of benefits
and financial ‘experts’ like Suzie Orman & Dave Ramsey that many people listened to never seemed to
understand these benefits & choices either and gave crappy advice about mortgages & refinancing.To say that there is no such thing as a no cost loan is just 100% WRONG and on $400K-$500K loans, interest savings of $30,000-$50,000 or more over the life of the loan are very possible, depending on the difference in rate (at absolutely ZERO cost)
January 3, 2016 at 9:00 AM in reply to: Starting 2016 by Ditching the Serial Refinancing Persona #792941Participant[quote=harvey]”no cost loan”
LOL[/quote]Oh Harvey,
How sad that you are LOL’ing.
No cost loans exist and if you never refinanced
to a lower rate with one then there is nothing to laugh about, you should be crying instead as you are wasting many thousands of dollars in interest over the life of your loan.It’s really sad that you would make such a comment.
I’m not sure who/where you get your financial advice.No cost loans exist and means your loan has NO COST. Lender credits pay ALL closing costs.
If you start with a $300,000 loan your new loan will be $300,000 and you don’t pay a penny in charges/costs to refinance.
It’s not a gimmick or a trick.
In many cases borrowers got money back in addition to a no cost loan.Mortgage brokers gave people money back.
Many banks didn’t give people money back.Ignorance, stubborness & foolishness about the biggest financial commitment of one’s life is nothing to LOL about.
Many people get confused about no cost loans but never bother to ask questions/have it explained and are wasting tens of thousands of dollars in interest.
(Instead they just LOL at the thought)
I bet that you think ‘banks’ have the best mortgage rates.Lowering one’s rate by just .25% at no cost
would mean saving a bunch with most CA loan amounts.January 3, 2016 at 1:31 AM in reply to: Starting 2016 by Ditching the Serial Refinancing Persona #792935Participant[quote=harvey]Did all the refinancing really pay off? Typically a refi takes a few years before the interest savings is break-even with the costs. Seems unlikely that one would come out ahead with several refinances….[/quote]
When getting a no cost loan and refinancing to a lower rate it, you start to save interest and benefit from day one; the day your new loan funds.
There is no future ‘break even’ period, you just need to understand the options when refinancing.
December 18, 2015 at 11:14 PM in reply to: Extra payments in car v home loan – one changes next due date, the other doesn’t #792711ParticipantGzz..
If you made a year’s worth of payments now and didn’t have to make a payment for 12 months, you would still be paying the same amount of interest and not saving anything; you would just be paying it in advance.Several options possible.
By paying $50K now, you will save about $1800 in interest over the next 12 months but still be obligated to make your same monthly payment which will pay down principal faster.
Are you comfortable with that ?
You could also pay down $25K now and save the $25K as a cushion.If you are willing to risk that you *probably*
will not need the $50K in the next year, pay down your mortgage:1) Call your servicer and ask them if you want to pay down a chunk of principal if they will recast your loan payment adjusted to the lower amount with the same payoff date. Sometimes possible.
Understand that they likely do not own your loan, they just collect payments. A mortgage backed security is expecting the monthly payment based on your original amount2) If you have at least 25%+ equity, apply for a HELOC (Home Equity Line Of Credit) if you can qualify. There’s no cost and you get a checkbook with a line of credit that should be no more than Prime (now 3.50%) and you should only be charged daily interest if you need any money in a pinch.
3) Get a credit card OR check the ones that you have for access to cash at 0% for up to 21 months, with a 1%-3% upfront cost.
**This is cheap money. I have clients that have been creative in paying down mortgage balances this way, you need a good credit score**There are ways to juggle debt with very limited risk. As long as you have access to cash somewhere
it’s not a bad idea.Never wait until you really need the money to set these strategies in place.
You can often get access to money when you don’t need it but if one waits until they lose their job and then applies, it’s much less likely that you can get approved when you really need the money.December 14, 2015 at 12:21 PM in reply to: Need advice on finding a good RE agent to buy and mortgage lender #792530ParticipantI’m not here to get leads but I don’t turn anybody away if I can help.
I have worked with about 100 Piggs from this site over the years, many were lurkers and not posters, but I’ve worked with plenty of active posters also.
I’m licensed for real estate and mortgages, and also a Realtor for anywhere in CA.
Commissions can be negotiated depending on the work/liability involved.I’ve never pushed anyone to buy a house OR told them it was a good investment.
Around the peak I talked people out of buying houses and I don’t know anyone who wasn’t thankful for that as well as coaching people through foreclosures.I do it because I enjoy it, not because I have to.
Consultations via phone are always free and I’m happy to take calls whenever I can, 7 days a week about purchasing OR refinancing so you can understand your options and that it’s not just about the payment, it’s really about the rate and what you will pay in interest.I’ve been a property owner & landlord for over 30 years and have seen a lot of crazy situations.
I see it from both sides.Qualifying for loans is idiotic but that’s the way it is.
It can be easier for someone with a 620 credit score to qualify with 3.50 % down than it is for someone with an 800 credit score and 50% down if they can’t show income properly.There are things that some people can do IN ADVANCE to make it easier to qualify for a purchase loan. When they call me with 30 days to close it’s too late for advance planning and stuck with ‘what is’
If you’d like to chat, just send me a message.
there’s a few things that you can do ahead of time, the rates will be whatever they are at the time you are ready to buy. SheldonParticipantThey need to be careful what they wish for…
there are always unintended consequences.
They might do the opposite of what they are supposed to.http://www.businessinsider.com/the-effect-of-negative-interest-rates-2015-11
Are you familiar with carry trade ?
I don’t see how rates can rise much in the US
(maybe .125%) when there are forces going the opposite way.It may turn out that a 2% long term bond is an amazing return.
The average person will probably never have the opportunity to borrow large amounts at very low rates however there are some simple strategies that
people with good credit can take advantage of today.People who can least afford it are paying 20%-30% interest on credit card debt and it’s become a way of life for many.
Negative interest rates do pose an interesting concept and paying interest on anything will only be for the poor.
Aside from that, aren’t there American (or other nationalities) owned granite stores who can buy granite from the same sources that the Chinese owned store is buying from ?
What’s going on here. The Chinese owner is working on a smaller mark-up OR the non Chinese don’t know where to buy product….. ??Participant[quote=harvey]Not sure the title warrants three exclamation points.[/quote]
Thanks for your comment.
just for you,
Edited to reflect only one but I reserve the right to increase that at some unknown future point.
It actually could be worthy of 5 or more.Negative interest rates were not really a concept 10 or 20 years ago.
You can ignore it if you wish, but it has serious consequences.Few people called the housing bubble long before
most people thought it was even a possibility that prices could drop 40%-50%A storm is brewing again.
ParticipantIt’s a very serious situation.
The 25+ year period from early 80’s through the 2008 was not a ‘normal’ economy although almost everybody seems to think that period was
normal and we are now in a depressed period.The stark reality is that the 25 year bubble period was the true problem. The aberration was the REAL problem, although the world seems to think that the bursting of the bubble, which created the ‘Great Recession’ was a complete surprise and could have been avoided.
This is utter nonsense, spin and media hype.With negative interest rates, it is possible that
house prices would continue to rise as most people who get a mortgage don’t really care what they pay for it, they only care about their monthly payment.Those who pay cash will think twice but still may buy because that is the price if you want to own it.
The world is treading on very thin ice.
In many ways the exposure to debt & derivatives is much greater than what was faced in 2008.Relying on past history is what most people do to plan their future,,, who knows; it might be different this time.
Black swans do exist.
Foreclosures were not the problem; they were the solution, yet the govt stepped in to keep the punch spiked.The real time to step in was at least 5 years earlier and the ‘problem’ would have never been created, but the idiots that thought they were going to fix the problem didn’t really understand what the problem even was, and most people drank the punch and thought the punchbowl would never go dry.
Sad but true.November 30, 2015 at 8:09 AM in reply to: What happens to your money if you overpay into your impound account? #791657ParticipantFLU,
Your rate IS 2.50% (not WAS)
Pay off your mortgage now and invest/play/gamble/pray with $2534 a month that you will have.
….I think it’s foolish to invest/play/gamble/pray with $75K thinking that you will come out ahead.There are hundreds of billions of dollars/euros/yen/francs/pounds/rubles/rand etc
being invested long term at rates lower than you are looking for by professional money managers
who understand risk MUCH better than the average person who is buying dividend paying stocks thinking they are safe and smart.The stock market has made fools out of MANY very otherwise intelligent people AND it’s going to do it again, possibly soon.
it’s time to wake up and stop thinking we are back in the 90’s facing huge economic growth again.
See my post on negative interest rates.
It’s time for everyone to reconsider what they think ‘must’ happen in the future and consider some alternatives.November 29, 2015 at 11:41 PM in reply to: What happens to your money if you overpay into your impound account? #791652ParticipantThe tax deductibility of a mortgage is a partial illusion and very misunderstood.
Depending on the size of a household, the standard deduction can be substantial and a better choice.
The true net deduction is the *difference* between all itemized deductions and the standard deduction.
The standard deduction is the same across the country and in areas with low housing prices & property taxes in many cases the standard deduction is a far better option than itemizing.
For those with plenty of cash, assets, good credit & cash flow it can be wise to just eliminate their mortgage & simplify their lives.
This isn’t right for everyone.It is foolish to accelerate a mortgage for those with 10-20-30% credit card debt, yet I’ve seen people do it.
With good credit, There are currently creative ways to borrow money for 1-2 years in the 1%-3% range.
1)You pay interest with after tax dollars.
2)You pay income tax on interest you receive.
3)NOT paying interest to someone else is a guaranteed *compounded* net return equal to your
interest rate.
There’s a distinct difference between the 3.In some cases I’ve suggested that people take 401K loans to eliminate their mortgage and repay themselves AND reduce their exposure to the stock market.
It’s an effective strategy using pre-tax dollars.
*Not suggested for everyone* -
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