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Lsut81
Chicago Cubs Fan
Member since Jun 2005
77330 posts

Mortgage Shopping

I’m negotiations for a new house and the broker I am working with told me she’s seeing anywhere from 4.8 a 5.1 right now.

Any recommendations on lenders to check? Want to make sure I’m getting best rate out there.

Also, I can, but really don’t want to put down 20%… anyone had success getting PMI waved only putting down 15%? Tactics?

TIA
This post was edited on 8/9 at 6:04 am


TJG210
LSU Fan
New Orleans
Member since Aug 2006
27496 posts

Where are you?


frankthetank
LSU Fan
Member since Oct 2007
2072 posts

quote:

anyone had success getting PMI waved only putting down 15%?


I'm not an expert, but I've never heard of having PMI waved, but you can avoid it by paying it up front. May be less than the amount you have to come out of pocket to get 20% down?


skewbs
US Space Force Fan
Houston
Member since Apr 2008
1548 posts

Putting 20% down largely depends on where you are trying to buy and how competitive the market is at the time. I live in Houston and over the past 2 years sellers wouldn't even consider offers that were not putting at least 20% down. That has nothing to do with you paying PMI, it's a sellers preference. Buyers putting 20% down, or much more down (or all cash), are stronger offers and will be favored.

Those days may be dwindling though. I suggest also discussing the amount you want to put down with your real estate agent (if you trust their opinion). They will usually have good insight too.


thegreatboudini
USA Fan
Member since Oct 2008
5677 posts

I'm shopping right now and in the same boat. I really don't want to drop the full 20%, but also hate the thought of MI.

Nobody has said MI would be waved, but if I did 12-15% that they would work with me to get the lowest possible one available, and cut some corners on closing costs to make up for some of the MI if I agree to pay it up front. This ultimately ended up dropping it into the 0.2-0.25% range, which I could live with.


TMFBB21
Baton Rouge
Member since Mar 2021
183 posts

You can pay your MI up front which sometimes is a better deal than paying monthly until you get to 20% - I would have to quote both options and see what your timeline to live in the house. If you plan to sell in the next five years, it might not be worth it. As for another rate quote, I can give you one if you are in LA or MS. Im typically less than most because I do not have a branch override fee. You can reply here or email (username @gmail.com) your credit score, and estimated house value. This would only be an estimate because I could not guarantee a rate until I had your contract and a complete application.


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Lsut81
Chicago Cubs Fan
Member since Jun 2005
77330 posts

quote:

Where are you?


Houston


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Billy Mays
New Orleans Pelicans Fan
Member since Jan 2009
24552 posts

quote:

Also, I can, but really don’t want to put down 20%


You won't get the best interest rate available (posted) without the 20% down.

Lenders don't really tell you that, but once you get your first loan estimate it will become clear :)


wutangfinancial
LSU Fan
Treasure Valley
Member since Sep 2015
9395 posts

The 4% coupon is what the MBS market wants right now so think about .5% higher than that so her estimate is accurate unless you buy it down more.


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TMFBB21
Baton Rouge
Member since Mar 2021
183 posts

This is incorrect- Investors give better rates to loans with MI because it is considered "less risky"


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Billy Mays
New Orleans Pelicans Fan
Member since Jan 2009
24552 posts

quote:

This is incorrect- Investors give better rates to loans with MI because it is considered "less risky"


Not in my experience. The last loan I did my interest rate went down to half a percentage point (from 3.625% to 3.125%) because I changed my down payment amount from 19% to 20%.

To each his/her own maybe.


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Ham Malone
US Space Force Fan
Member since Nov 2010
2361 posts

Why would a seller know or care how much a buyer is putting down? If the seller accepts an offer with a loan, it doesn’t matter what the buyer puts down as long as the lender completes funding for closing.


Lsut81
Chicago Cubs Fan
Member since Jun 2005
77330 posts

Question if I qualify with one and lock in a rate, can I continue to shop rates until closer to closing?

I asked the broker if rate decreases prior to closing if I can lock that in and she said it has to be a .25 drop.


BearCrocs
LSU Fan
Member since Aug 2013
4942 posts

Ask a couple of buddies or family members who they used for their lender.

I did a 5% conventional 30 year back in 2016 at 3.25%

I need to go ahead and get my house appraised so I can get PMI removed, but if you're buying in Houston your property taxes are going to frick you more than anything.. PMI is the least of your concerns.

Homeowner's insurance and property taxes are through the gaw damn roof.


Lsut81
Chicago Cubs Fan
Member since Jun 2005
77330 posts

quote:

Houston your property taxes are going to frick you more than anything.. PMI is the least of your concerns.


Yup… well taxes, insurance not too bad. In an X zone. Only place I’ll ever buy. Every house I’ve ever bought is this way and I’ve never had flood.


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Ham Malone
US Space Force Fan
Member since Nov 2010
2361 posts

Sure you can keep shopping after locking in a rate. The disadvantage is you’re only getting a rate lock once you’re under contract so you’ll have provide all your financial documentation to multiple lenders while in a time crunch to meet your contractual deadlines.


Lsut81
Chicago Cubs Fan
Member since Jun 2005
77330 posts

Well if we have any brokers who deal in Texas that want the make a run at this, please let me know.


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GatorH8r
Member since Aug 2019
64 posts

Lender will still perform appraisal of the house and if it comes in lower than sales price and client doesn’t have the downpayment and difference to cover the deal is cooked. It offers more risk for the seller vs larger downpayment.


Fox McCloud
Member since Oct 2020
3313 posts

quote:

You won't get the best interest rate available (posted) without the 20% down. Lenders don't really tell you that, but once you get your first loan estimate it will become clear :)


Not true at all. I got offered the same rates at 5% down and then I recast to put down 20% when my other house sold.


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Ham Malone
US Space Force Fan
Member since Nov 2010
2361 posts

The appraisal gap is a different issue and a big reason why cash offers win versus loan offers. I still don’t know how a seller is going to know how much a buyer plans to put down outside of the earnest money deposit but I’m not in Texas so maybe it’s different there.


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