7.85% Rate 2 mths after discharge

[CoachK]

We closed on our $200K mortgage in Aug. and got a rate of 7.85 just two months out! My broker was great! First, our rate was to be 8.25%, but he called the day before closing and gave us the news of the decrease. It saved around $60 per month.

If anyone wants a good broker in PA, let me know. I am not sure if he lisenced in other states.

[newstart]

Good for you CoachK, there is life after bk.

[MTG_BANKER_OH]

We closed on our $200K mortgage in Aug. and got a rate of 7.85 just two months out! My broker was great! First, our rate was to be 8.25%, but he called the day before closing and gave us the news of the decrease. It saved around $60 per month.

If anyone wants a good broker in PA, let me know. I am not sure if he lisenced in other states.

Congrats, what lender did you end up with for your mortgage?

[JeepMom]

How many points did you have to buy? What was your closing costs? Is it ARM? What are the stipulations of the ARM?

[Mrs.Johnson]

Is that a fixed rate mortgage or ARM? Is it 100% financing?

[JeepMom]

I think this could be another phising scam.....cough....tom....cough.....

[tradewiz50]

Nice rate CoachK. What were your terms of your loan if you don't mind us asking?

[Lhen1059]

wow, good for you. Do they service TX?

[Spiritwovles_2]

We closed on our $200K mortgage in Aug. and got a rate of 7.85 just two months out! My broker was great! First, our rate was to be 8.25%, but he called the day before closing and gave us the news of the decrease. It saved around $60 per month.

If anyone wants a good broker in PA, let me know. I am not sure if he lisenced in other states.

id be interested in learning who this broker is. congrats to you.

[CoachK]

Lender info

Sorry for never responding, but I moved and really forgot about the board. My lender was from Pittsburgh-- Pinnacle Lending. I did a search on the National Real Estate Broker website to find him.
He ended up doing my loan w/ Wells Fargo.
It is a 2/28 ARM.

[HHM]

It is a 2/28 ARM.

OUCH, OUCH, OUCH.

What is the index rate and what is the margin increase. I can't imagine it will be very good if your fixed rate is 7.85%

For those that don't know, a 2/28 ARM is an adjustable rate mortgage where the interest rate is fixed for the first 2 years, and then can change each year thereafter. This is a very common type of loan for people with so so credit. These loans are often referred to as "B Paper Loans".

Objectively speaking, its hard to know if this is a good deal or not unless we know the index rate and the margin rate. For example, the Index rate might be the yield on the 30 Year Treasurer note, or the Prime Interest rate (it can be anything)..the Margin rate is the amount over the index rate which is used to come up with the APR for the Mortgage. So, for example, it may say "3 points over Prime" (which means your mortgage interest rate would be the Prime Interest lending rate plus 3). The current rate of a 5/1 ARM is 5.62%

It might have been better if you waited a year or so from BK before embarking on a home purchase. Sure, you might be able to refinance out of this loan in a few years, but in the long run, that can be expensive.

Like Jim Cramer would say..."I am not going to bless this deal"

[Runnin on empty]

OUCH, OUCH, OUCH.

What is the index rate and what is the margin increase. I can't imagine it will be very good if your fixed rate is 7.85%

For those that don't know, a 2/28 ARM is an adjustable rate mortgage where the interest rate is fixed for the first 2 years, and then can change each year thereafter. This is a very common type of loan for people with so so credit. These loans are often referred to as "B Paper Loans".

Agreed. I don't know much about ARMs, but that doesn't sound too favorable to me.

[CAB_44]

I've seen TOO many people get in really big trouble with ARMs.....

[invest1choice]

Like me... Never again .. Learned lesson...

[FilingOnMyOwn]

Who cares? 7.85% is not horrible, interest rates are not going to be going much higher in the near/short term, and you can refinance after a year or two. The risk/reward equation is in your favor for the time being.