Mortgage Underwriters FTL

[Thieroff 10+ year member]

Anyone buying a home goes through it. If I was going to hand over a shit load of money for someone, I'd make sure they have the discipline to jump through some hoops as well.

Oh, no doubt at all. I've met all my conditions, waiting on the property now.

CT

 

[IamDeMan 5,000+ posts]

I would suggest that it all depends upon your expectations for the future. Do you expect interest rates to rise and do you expect to be in the same home for more than 10 years.
I do expect rates to rise but our loans are capped at 1% a year and I don't expect to be in the house for longer than 5-7 years. So what happens to the amoritization of years 8-30 I don't care about. All I care about is minimizing my interest and initial payments and maximizing my opportunity to build equity and enjoy price appreciation.

Yes it depends on situation. I plan to be at my home 10+ years, so ARM was out of the question. Of course, I am not paying PMI either, so I didn't need to make a choice.

 

[Flipx99 5,000+ posts]

I would suggest that it all depends upon your expectations for the future. Do you expect interest rates to rise and do you expect to be in the same home for more than 10 years.
I do expect rates to rise but our loans are capped at 1% a year and I don't expect to be in the house for longer than 5-7 years. So what happens to the amoritization of years 8-30 I don't care about. All I care about is minimizing my interest and initial payments and maximizing my opportunity to build equity and enjoy price appreciation.

My time horizon is even less...(4-5 yrs)

Hell, if the market is booming at year 3, I will sell the house...use that as a time to take my long term educational opportunity and live on campus housing for a year to give the market to cool.

But more than likely, I expect the rates between year 4 and 5 to be about the same as they are now.

 

[Flipx99 5,000+ posts]

Yes it depends on situation. I plan to be at my home 10+ years, so ARM was out of the question. Of course, I am not paying PMI either, so I didn't need to make a choice.

If I were planning on staying that long, I'd chose a fixed rate as well.

Perhaps you forget being 24...or maybe they had better plans back then.

 

[IamDeMan 5,000+ posts]

If I were planning on staying that long, I'd chose a fixed rate as well.
Perhaps you forget being 24...or maybe they had better plans back then.

I never had to choose between ARM or PMI. I didn't have either on my first or current home. I don't forget being 24 and I can understand your decision now.

 

[Flipx99 5,000+ posts]

I never had to choose between ARM or PMI. I didn't have either on my first or current home. I don't forget being 24 and I can understand your decision now.

I see...where the standards different or were you one of the few that had 20% down?

 

[DD_Dave 10+ year member]

I just saved a little out of each check so I could pay cash for my new house... th' hell with any loans....bloodsucking banks ftl

 

[scarolinablazin 10+ year member]

you both better go back and reread your mortgage contracts. odds are that 1% cap you see isn`t 1% over what you`re rate is now it`s 1% over whatever the rate is at the time of the increase. as in you have 5% now, you get an increase in 3 years. then the average rate is 7%. now do you honestly think they`re gonna let you slide with just 1 more % and still be under the average? most likely you`re gonna get hit with 8%. 1 % over the highest average at the time of the increase. i just bought my house 8 months ago. there were a few different options with just arms. and BTW, if you`re planning on staying in your home more than 7 years i`d check into buying down your rate and getting a 30YR fixed. where i live it`s roughly $1000 per 1/4 %. unless you have terrible credit the average % is at 5.5 so 2 grand buydown would give you 5 flat.

 

[Flipx99 5,000+ posts]

you both better go back and reread your mortgage contracts. odds are that 1% cap you see isn`t 1% over what you`re rate is now it`s 1% over whatever the rate is at the time of the increase. as in you have 5% now, you get an increase in 3 years. then the average rate is 7%. now do you honestly think they`re gonna let you slide with just 1 more % and still be under the average? most likely you`re gonna get hit with 8%. 1 % over the highest average at the time of the increase. i just bought my house 8 months ago. there were a few different options with just arms. and BTW, if you`re planning on staying in your home more than 7 years i`d check into buying down your rate and getting a 30YR fixed. where i live it`s roughly $1000 per 1/4 %. unless you have terrible credit the average % is at 5.5 so 2 grand buydown would give you 5 flat.

Lender: AEDC Federal Credit Union
This adjustable rate mortgage program disclosure describes the features of the adjustable rate mortgage (ARM) program you are considering. The interest rate and payment amount of your loan are subject to change. The loan will have a term of 30 years. Information on other ARM programs is available upon request.

No changes in interest rate or monthly principal and interest payments during the first 3 years.

How Your Interest Rate is Determined

Your initial interest rate has discounted and is not based on the index and margin used to make later adjustments. Ask us about our current interest rate and the amount of any Premium or Discount.

At the first, and subsequent, Change Date(s), your interest rate will be based on the sum of the index plus our margin, rounded to the nearest one-eighth of one percent (.125%), unless "caps" limit the amount of change in the interest rate. The most recent Index figure available 45 days before each Change Date is called the "Current Index". Ask us for the most current interest rate, index and margin.

The index is the weekly average yield on United States Treasury securities adjusted to a constant maturity of 1 year, as published in the Federal Reserve Board's Statistical Release H.15 (519), available at http://www.federalreserve.gov/releases/h15/. If the index is no longer available, we may choose a new index that is based on comparable information. You will be given notice of any change of index.

Changes in Your Interest Rate

Your interest rate can change yearly, beginning with the first Change Date (36th payment).

Your interest rate cannot change more than 1 percentage points per year (annual cap) nor increase more than 5 percentage points over the term of the loan (lifetime cap).

Changes in Your Monthly Payment

Your monthly payment (principal and interest) can increase or decrease substantially (after the third year) based on annual changes in the interest rate, the loan balance, and remaining loan term.

There are no limits on the increases or decreases to your monthly payments other than limits on changes in the interest rate.

You will be notified in writing at least 25, but no more than 120 days before the due date of a payment at a new level. This notice will contain information about the index and interest rate, payment amount, and loan balance.

see contract

 

[DD_Dave 10+ year member]

house payments seem scamish to me....I don't mind an occasional simple car payment.....too much fine print in buying a house that is why so many people end up loosing their homes....

 

[JCJetta 10+ year member]

People are losing their homes because they calculated their affordability based on monthly payments. As such, they bought more than they could afford.

If you are going to borrow $100k+ over the course of 30 some years, wouldn't you read all of the "fine print" before you signed off on them?

Predatory Lenders were the ones going after the sub-prime folks. These were the high-risk people who failed to read the fine print, calculated their affordability based on monthly payments, and neglected to realize they were being charged fat double-digit APRs. Even worse were the interest-only loans; don't even get me started on those - nothing like "renting" your own home.

 

[richierich75 10+ year member]

Haven't been declined or anything, the conditions are a pain in the ***, though.
Anyone ever been through this?

CT

I'm glad my wife and I didn't have to deal with this when we bought our house, of course it was prior to all of the loans foreclosing, but my wife's A+ credit really helped. Had no problems refinancing during the last fed's interest rate cut we are now at 5.25 fixed 30, pulled out $25,000 paid off credit cards and put about 5 grand back into the house.

wish you the best of luck man, as you said it is definitly a buyers market. I would however advise to not jump to quickly in to areas where houses have dropped drastically as more than likely they are not done dropping and you definitly don't want to be upside down when you walk in. Housing is cyclical and will more than likely not begin to appreciate again until 5-7yrs, which works perfect for our situation.

good luck man

 

[IamDeMan 5,000+ posts]

I see...where the standards different or were you one of the few that had 20% down?

I had the required 20. My first home was considerably less than you are looking at though.

 

[nate2587 10+ year member]

I am going through my mortgage process right now i didn't have to jump through hoops to get Pre-approved my credit score is 633 which isn't that great at all

30 year fixed 6%

house was a foreclosure (Bank bought it back for 234,900 ) It's been on the market for 4 months now

They accepted my offer for 132,000 + 9,000 in closing costs (taxes where freaking through the roof)

Talk about instant equity!!

I just got the news 20 min ago. excited //content.invisioncic.com/y282845/emoticons/smile.gif.1ebc41e1811405b213edfc4622c41e27.gif Nice starter home for myself

 

[Flipx99 5,000+ posts]

Congrats!!! Hopefully it wasn't beat to shit.

I saw one place that was a forclosure where someone was shot or stabbed and there was blood on the walls.