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November 25, 2015 at 10:43 PM in reply to: What happens to your money if you overpay into your impound account? #791586November 25, 2015 at 10:29 PM in reply to: What happens to your money if you overpay into your impound account? #791585
HLS
ParticipantI understand what you were thinking..
What is your note rate ?
**That is your cost of the money.(If you could make 2%, would you get a 1099 and have to pay taxes on it, netting much less?)
If you just want your mortgage out of the way, pay it off.
Depends what your future plans are.I’m sure your credit is great. You will always have access to cash at some rate.
I have dealt with many people who are house rich and cash poor. They were in a rush to pay off their house and ran in to trouble because they lost their job and/or can no longer qualify to refi and take money out for one reason or another.
I’ve met people with lots of equity in their home who don’t sleep well at night because they worry about their cash flow.
I’ve also had people tell me that they sleep better at night with a nice cash cushion in the bank even though they have some debt that they could pay off if they wanted to.
It’s not a matter of right or wrong; it’s what you feel is right for your situation.
The wild card is that nobody knows what their future holds.
There are virtually no risk free investments today that will beat your mortgage rate, net after tax.
(With some risk there are lots of options)
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Another way to look at it is:
If you pay it off now and give up $75,000 in cash,
your guarantees are:
1) No more monthly payment of P&I
2) You will not have to pay $2750 interest over the next 3 yrs
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If you can invest the money correctly, you may be taxed on the income that it generates, so you will need to receive a much higher rate than your note rate just to pay the interest and be even.November 25, 2015 at 9:20 PM in reply to: What happens to your money if you overpay into your impound account? #791583ParticipantWith your calculation, you are just averaging your remaining interest expense over 3 years.
Don’t forget that you are paying interest on a declining balance each month.
If you go to an amortization website that shows a breakdown you will see exactly how much your interest expense is.
The interest that you paid this month is much more than the interest that you will be paying next year.
Your payment is the same so more will go to principal.Does this make sense ?
Each month your interest portion of your payment is based on the principal balance for the previous month.November 25, 2015 at 8:18 PM in reply to: What happens to your money if you overpay into your impound account? #791581ParticipantFlu,
The interest rate on your note is your interest rate.
I don’t think that you have a 1.18% rate.Where did you see that a servicer must pay you 2% ? Interest is required to be paid in 15 states,
(Including CA) but I’m not aware of a minimum %.I doubt that any servicer would allow that type of money to sit in an impound acct very long.
They would most likely return it to you.ParticipantIMO an asset bubble has been created by low rates.
What do you think will happen if mortgage rates move up substantially.
Most people scrape by with a down payment and need to qualify for a loan.
There will be an adjustment period, but at current prices, it will be much harder to qualify for a loan. You think prices will go higher ?There will always be people who must sell at whatever the market is due to death, job loss/transfer, divorce etc.
There will always be others who will wait for prices to go up before they will sell.People who are myopic about Southern CA real estate don’t understand the national scope of home prices AND the quality of life in so many other places at higher/better standards of living.
Given the fact that you are considering leaving this area; listen to spouse and sell now.
Take the tax free gain and move.
(Take the money and run)Austin & Oceanside are not the only 2 places in the country to consider living. If Texas doesn’t work you’ll find somewhere else.
The net return on a $500,000 home here coupled with being an absentee landlord wouldn’t be attractive to me.
Being a landlord is a great road to wealth but I think many people are delusional about the potential for appreciation coupled with true carrying costs for maintenance/vacancies etc.
and the headaches of being an absentee landlord.Having the cash will give you options.
Decide later if you want to pay cash in TX or
buy rentals there (or someplace else)or just sit on the cash.The cash flow and cap rates are much more attractive elsewhere.
The tax free gain option could go away.November 11, 2015 at 3:05 PM in reply to: Need help…lease-back or extend escrow? Pros & cons? Other options? #791203Participant[quote=spdrun]The OP said “jumbo loan” which implies that it is not GSE-backed.[/quote]
‘Banks’ rarely write their own guidelines for jumbos.
They use the guidelines for conforming loans.
Reserves are rarely needed for GSE loans, but often required for TRUE Jumbo. There are additional overlays.Depending on credit score and the % of down payment,even getting a loan as investment property
may not even be an option.There is way too much risk on the back end.
FNMA guidelines are in the range of 1300 pages.
Why would any institution decide on their own when the others are public information.Unless one has a source of funds for 30yr money,
it’s crazy to lend money for 30yrs and only have
5yr CD’s. Pure insanity.
Very few institutions offer anything longer than a 10yr CD for deposits.
30yr bonds are trading at 3.11% today, approaching a 52 week high of 3.25%November 11, 2015 at 11:59 AM in reply to: Need help…lease-back or extend escrow? Pros & cons? Other options? #791195ParticipantYou folks don’t seem to understand that ‘banks’ are mortgage brokers.
They don’t lend their money for 30 years.
‘Banks’ don’t make the rules. Fannie/Freddie/FHA/VA make the rules and some guidelines are simply idiotic. I’ve rarely seen exceptions.Taking fresh baked cookies to the loan officer or manager at the bank isn’t going to get an exception.
Standard guidelines are that the CONTRACT cannot state more than 60 days before buyer takes possession OR it’s a rental property.
You aren’t going to get a lock extension until March. Rates have moved up significantly in the last week and are not likely to go back down.
As stated above, the parties involved should be able to figure this out (cough!)
I know I could.ParticipantFor the record;
Flood/Mold remediation is *NOT* a huge scam.ParticipantThere is a difference between mold & mildew.
The term ‘mold’ is often used incorrectly.GENERALLY black mold will grow worse over time and needs to be treated professionally (of course some people are experts and can do it themselves and claim that there is no longer any problem)
Mildew is generally easier to clean and is often a housekeeping issue.
Steam from a shower is probably mildew, long before it is true mold.
It’s common for most people to claim mold at the first sight of anything black on a wall or ceiling.
The point is, there IS a difference.FROM HGTV:
Mildew is a surface fungi that can easily be identified as a patch of gray or even white fungus that is lying on the surface of a moist area. Mildew is easily treated with a store bought cleaner and a scrubbing brush.Mold, on the other hand, can be black or green and is often the result of a much larger infestation. This type of fungus can appear almost “fuzzy” — especially when it is found on food — or even slimy in nature.
Here are a couple of good links that explain the difference.
http://www.mold-advisor.com/mold-vs-mildew.htmlOSHA Fact Sheet
https://www.osha.gov/OshDoc/data_Hurricane_Facts/mold_fact.pdfParticipant[quote=FlyerInHi]
Btw, flood/mold remediation is a huge scam.[/quote]
Is there anything that you are not an expert on ??
https://en.wikipedia.org/wiki/Mold_growth,_assessment,_and_remediation
ParticipantBG,
I don’t care about the T/J..
It turned into an interesting discussion 😉There are so many ‘programs’ that are ‘broken’
People who benefit from them defend them.
Those who can’t benefit feel cheated.
Always makes for good, friendly discussion !~ParticipantThe law is 100% clear.
Per RESPA there is absolutely no way that they can require you to only use their lender.
This is black & white. It would be considered ‘steering’ which is illegal.Requiring you to qualify with their lender may be illegal as well, but it’s a gray area.
ParticipantI would not suggest that anyone buy a house that they are not crazy about.
Things that you don’t like may bother you much more
later if they can’t be corrected.Since you are relieved that this one didn’t close, walk away and don’t look back.
In the future, use the contingency period to figure out if it’s the right house for you.
Never let anyone else try to convince you to buy if your gut tells you otherwise.There will be other houses to look at and buy.
Happy Hunting! HLSParticipantAny appraisal is the opinion of the appraiser, but always backed up with valid comps however that is an unusually large spread.
Not all appraisers are VA approved. Both of yours should have been.Was the $305K for 1 parcel or both ?
the $375K was for 2 parcels, correct ?If you still like the property, try to negotiate price, terms & lot adjustment.
ParticipantIf the home is on just one parcel have your Realtor pay for a new appraisal and see what happens. Do you need the other parcel ?
Have them deed it to you separately.There are creative ways for you to get this done.
Most Realtors don’t know much about loan qualifying and financing. A Realtor is not a loan officer. (Unless they are licensed for both!)I don’t understand why this problem didn’t come up the first week when the preliminary title report
was received by the lender.Call the county and ask about the cost/time frame
to do a ‘lot line adjustment’
It is possible to create a larger lot if necessary.(I’m Realtor AND licensed for loans)
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