Bankrate.com is totally bogus, I agree.

Thanks you mortgage guys.  You just answered a question I have had for awhile, which is, “Are some of these rates that I see and hear advertised really obtainable, or are they just advertisement?”

I didn’t know that about bankrate.com.  Thanks for the heads up…

30Y conforming: 11/16/2007:

5.699% APR 0 points with $8659 in fees or:

	6.030% with $1264 in fees

$8659 in fees is NOT 0 points. That is robbery.

I checked on a lender I used to do business with, and if you want to pay $8k+ in fees, I would be able to do that 5.699% rate. A 0 point, no origination fee, for a friend deal, I would be able to do 6% with the $1264 in fees. Whatever the hell those fees are? You pay one way, or another, and no one works for free.

Some banks charge a 1% origination fee, but say it is a 0 point deal. That used to be the standard, but the Ditech 0 point deals killed it. BTW points can be a good thing.

I would be inclined to pay points over higher interest because IIRC, you can deduct points.  Is this true, Awgee?

Here is an article that explains some of the choices regarding deducting points.  I’ve always spread the deduction out over a period of time b/c my standard deductions have always been more lucrative.  RealEstateJournal | Don’t Cheat Yourself On Mortgage ‘Points’
My deduction ended up only being something like $30.00 per year though !
awgee probably knows the best answer.
I’ve also been told that if you don’t plan on staying in your house for at least 7 years, don’t pay points.  I guess you won’t make your money back if you sell sooner than that….

2. awgee

With 1369 posts
Whoa !  This blogger has been active lately ! 

Generally speaking, on the purchase of a home, you may deduct the points in the year the house is bought.  Generally speaking, points paid for refi, 2nds, etc. are deductable over the life of the loan.  And if the loan is paid off early, the remaining amount is deductable in the year the loan is paid off.  But, of course, there are exceptions.

Troop makes a good point (eh, pun unintended), on when points pay payoff. If I take the difference in "fees" in the bankrate example, $8659 - $1264 = $7395. I would take the difference in the two payments, $400k loan amount, 5.75% = $2334 and 6% = $2398, a difference of $64. All you do is divide the $7395 by the $64, and it would take 116 months or almost 10 years for the points to break even.  Not really a good deal. Sometimes it makes sense, sometimes it doesn’t.

Points = prepaid interest and should be deductible. There is a gray area about origination fees not being the same thing, and are not deductible. IMO they are the same thing, but awgee knows the IRS better than I do.

Go to www.freddiemac.com
The front page has the current 30yr fixed survey. Right now the average is 6.24% with 0.4 points in fees.  If you hear anything way off from that, I’d question it.

As of tomorrow Indymac will no longer write loans with negative amortization.  Countrywide to follow suit.  This is a nail in the coffin for those borrowers that already have neg am loans.  These people can only afford neg am payments.  Now the only product that they can afford is going away.

you forgot to add that the tax payers are going to be left holding the bag too!!!!

That is huge. Who is still making these loans now?

That is a fat cat

LOL [Broker Outpost, spotted on CR]

 That has to be a joke though. Right?

Effen,

Thanks for the laugh. Larry is one hilarious guy.

"Actually Larry they never went out of business, in fact I just closed a deal with New Century, it’s just, they don’t like you. I’m sorry to break it to you, it was supposed to be a huge secret until you left the business".
LMAO Eff !  thx.

Nice link, eff-
" mbrownusa -
Wow screw watching SOAP, this is better.

All this and a lot more on BO."
 
 

Larry must have been joking.  Nobody could be that stupid.

"Nobody could be that stupid." I have learned to stay away from making this assumption, as I have been proven wrong in instances before

MAX LTV AND CLTV at Indymac just reduced to 75% for all stated income jumbo loans.  Yikes!  A large percentage (I’d say more than 60%) of all jumbo loans are stated income.

This means if you want to purchase a home for 750K and you need to utilize stated income for whatever reason, you’ll need to put down $187,500.

HA!  good luck with that!!!

I still keep hearing about 100% financing.  Who is still offering these kinds of loans?  

maybe for conforming mortgages. Anyone who is still doing 100% business will be out of business in 6 months.