2.5% 0-point 30-year is here!

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Submitted by gzz on July 6, 2020 - 10:24pm

Online quote from loancabin.com:

480k no-cash-out 30 year refi 1.1m home value: 2.500%/2.504%

They also have a 15 at 2.375, but why bother!

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Investment condo rate with LTV<50% is 3.0%.

When I do my rental condo revenue less taxes/ins/hoa at a 3% cap rate, I get that it is worth about 30% more than its zestimate.

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Other sites with very low rates now: lenderfi, better.com, owning.com.

There is a Better.com $2500 offer from Amex, and Better.com also does rate matches. If you are willing to jump through additional hoops, that could be the best deal. I did not see that offer when I logged into my CC and browsed through them, but it seems like most people do.

Submitted by OC transplant on July 7, 2020 - 12:01am.

Geez! That's amazing, thanks for sharing. I just started refi process with another shop at 2.875% zero cost but may have to jump over to them or see if my lender will match.

Submitted by sdrealtor on July 7, 2020 - 10:01am.

Thank you and that is incredible.. Will see what happens as I just sent in app to refi to 20 years at 2.5%. If this works out there will be a very nice bottle of wine coming your way

Submitted by EVSDCA on July 7, 2020 - 10:57am.

Thank you. I just finished my refi to 20 years at 3.0% with a $2,300 cost. I may need to take another close look at what is offering now.

Submitted by gzz on July 7, 2020 - 12:35pm.

OC, I saw 2.75 zero cost/negative points on a few sites.

Rates for 20 and 25 seemed to be exactly the same as 30, and 15 barely any savings.

I've been looking on and off for a couple years, and I can't think of ever seeing a savings for a 20 or a large savings for a 15.

Submitted by scaredyclassic on July 7, 2020 - 12:46pm.

i just paid down my mortgage, a lot, but im a little tempted to start over and cashout refi at 2.5 %.

I was quoted 1.5 points on that.

im too scared to act at 2.5% i think but at some point,not sure where; 2% ? 1.8%? id feel like a dope for not taking the money and trying to beat it investing.

if oil can go negative, maybe the 15 y. could head down to close to zero? crazy.

Submitted by Coronita on July 7, 2020 - 12:57pm.

I need to buy another house so I can take out a mortgage.

Wait, usually isn't it I need to get a mortgage so I can buy a house?

Lol

Submitted by sdrealtor on July 7, 2020 - 1:56pm.

dupe

Submitted by sdrealtor on July 7, 2020 - 1:25pm.

gzz wrote:
OC, I saw 2.75 zero cost/negative points on a few sites.

Rates for 20 and 25 seemed to be exactly the same as 30, and 15 barely any savings.

I've been looking on and off for a couple years, and I can't think of ever seeing a savings for a 20 or a large savings for a 15.

Rates are so low that usually same on 20 vs 25 or 30 lately. Difference is more in the costs.

Submitted by gzz on July 8, 2020 - 12:20pm.

SDR: I didn't see even a cost difference for going 20 instead of 30.

Scaredy: avoid the big interest rate penalty for cash-out by doing a normal no cash-out refi, and then getting a HELOC if you actually need money.

Submitted by scaredyclassic on July 8, 2020 - 12:46pm.

gzz wrote:
SDR: I didn't see even a cost difference for going 20 instead of 30.

Scaredy: avoid the big interest rate penalty for cash-out by doing a normal no cash-out refi, and then getting a HELOC if you actually need money.

Problem is i owe only 175k and its not enough for the lowest rate

Submitted by Coronita on July 8, 2020 - 12:49pm.

scaredyclassic wrote:
gzz wrote:
SDR: I didn't see even a cost difference for going 20 instead of 30.

Scaredy: avoid the big interest rate penalty for cash-out by doing a normal no cash-out refi, and then getting a HELOC if you actually need money.

Problem is i owe only 175k and its not enough for the lowest rate

Well, like I said, normally one would need get a mortgage to pay for a new house.

But lately I'm thinking ....

I need to find a new house so I can get a brand new mortgage.

Lol, yeah I know that's backwards...But interesting times we live in.

Submitted by scaredyclassic on July 8, 2020 - 1:31pm.

Coronita wrote:
scaredyclassic wrote:
gzz wrote:
SDR: I didn't see even a cost difference for going 20 instead of 30.

Scaredy: avoid the big interest rate penalty for cash-out by doing a normal no cash-out refi, and then getting a HELOC if you actually need money.

Problem is i owe only 175k and its not enough for the lowest rate

Well, like I said, normally one would need get a mortgage to pay for a new house.

But lately I'm thinking ....

I need to find a new house so I can get a brand new mortgage.

Lol, yeah I know that's backwards...But interesting times we live in.

I really dont want any extra money. Its too painful to spend. But i want a 2.5 perc. Mortgage!

300k min to refi.

Money is annoying to ha e, not have, desire, avoid, slave for ...its just a cruel mistress.

Submitted by Coronita on July 8, 2020 - 2:23pm.

I got it scardey. Do a $300k cash out refinance. And then make a $125k principle payment right after your loan is funded..... j/k

Submitted by scaredyclassic on July 8, 2020 - 8:28pm.

Would it be crazy to just do the max cashout refi for 15 yeats and try to arbitrage a profit with a diversified portfolio. Hell make it 30. Thatll take me to almost 90.

Might be a little nervewracking but seems like a decent bet at 2 to 2.5 perc. 15 y mortgage.

Really weird---

5 y. arm rate HIGHER than 15 y fixed.

Does that mean the market think rates are headed down? You actually pay more for the chance to pay less, with a 10 year shorter term? Seems very very strange

Submitted by gzz on July 9, 2020 - 8:17am.

Scaredy, I’m skeptical of this higher rate for $175k thing being common. I think try other lenders.

As for rate arbitrage, go for it. Stay conservative when you do. I’d say vanguard utilities etf, BBN, GBAB, VZ, and T.

Not a good play for the average investor, but you can handle it.

Submitted by scaredyclassic on July 9, 2020 - 10:58am.

even at 2.5 % mortgage, I've got to beat a 4% taxable return to make the investment worth it after taxes. will that be tough over the next 15 to 30 years?

Submitted by gzz on July 9, 2020 - 12:40pm.

BBN and GBAB are taxed as ordinary income and pay 5 and 5.5%. They are nearly the same so I'd go with GBAB.

The others are taxed at the lower dividend rate, not as ordinary income, and all well over 2.5%. They could all go down long-term, but I don't think that's terribly likely. The main risk of them going down is probably President Biden does a big corporate tax increase. But I think that risk is mostly already reflected in their prices.

If you want complete risk free gains, it isn't going to work. But if you have 2m+ net worth and are playing with 100-150k, I think you want positive expected return, not risk free return.

Submitted by scaredyclassic on July 9, 2020 - 1:35pm.

when i was paying down the mortgage, i thought, ah, freedom at the end of it. also, look at all this interest im saving.

But when the balance is low, i now think, well, then what? the equity sits there, not growing. why was i in sucha rush to pay it all off?

verily, there is no freedom in this life, financial life is just rearranging deck chairs on the titanic, moving money from this to that.

if rates were 1% id still probably be afraid to take it. too risky. even .5 %, Id be like, well, what if everythings flat for a decade or more?

Submitted by gzz on July 9, 2020 - 2:00pm.

"the equity sits there, not growing."

The yield on your residence's home equity is your use and enjoyment of your house. In government statistics this is called owner equivalent rent. It is, in fact, growing if the rental value of your house, which you avoid by owning the house, is growing.

When you paid down the mortgage, your interest cost went down but your use/enjoyment did not.

Submitted by scaredyclassic on July 9, 2020 - 2:24pm.

ah right, I forgot about that. So if my house is worth a million, and it'd rent for 60k a year, I'm making 6% tax free by just living there and not selling the house.

but i could still live there and get the 60k worth of owner equiv. rent even if i borrowed money against it. as long as i can still make the payments...

but frankly, id probably be happiest doing nothing.

i want a facemask that says: CAPITALISM IS THE VIRUS ...

https://annlew.is/shop/capitalism-is-the...

Submitted by scaredyclassic on July 10, 2020 - 10:31am.

gzz wrote:
BBN and GBAB are taxed as ordinary income and pay 5 and 5.5%. They are nearly the same so I'd go with GBAB.

The others are taxed at the lower dividend rate, not as ordinary income, and all well over 2.5%. They could all go down long-term, but I don't think that's terribly likely. The main risk of them going down is probably President Biden does a big corporate tax increase. But I think that risk is mostly already reflected in their prices.

If you want complete risk free gains, it isn't going to work. But if you have 2m+ net worth and are playing with 100-150k, I think you want positive expected return, not risk free return.

This morning, i am a definite no. Some days i believe in the future.

Today, i feel we are all doomed financially.

Submitted by barnaby33 on July 11, 2020 - 2:34pm.

I went to LoanCabin and filled out the inquiry paperwork. 2 days later I get an email asking me for some rough details, to which I responded yesterday. Still no response.

Strangely I've pinged HLS twice and he's not responded either. Maybe I'm un-loan-worthy, sniff...
Josh

Submitted by svelte on July 11, 2020 - 7:33pm.

They are probably swamped right now with rates that low.

Submitted by scaredyclassic on July 11, 2020 - 8:05pm.

The lenderfi website had a notice thst they were not taking apps for a while.
Crazy!

Submitted by Coronita on July 12, 2020 - 8:36am.

barnaby33 wrote:
I went to LoanCabin and filled out the inquiry paperwork. 2 days later I get an email asking me for some rough details, to which I responded yesterday. Still no response.

Strangely I've pinged HLS twice and he's not responded either. Maybe I'm un-loan-worthy, sniff...
Josh

Im pretty sure it's just because they are busy with an overwhelming demand to refinance. Did you end up getting a forbearance or did you end up skipping it?. I read somewhere that they changed the rules so that people in forbearance could refinance, so I was curious if there were real examples of this happening.

Submitted by svelte on July 12, 2020 - 8:41am.

Now is probably a good time to remind everyone to double and triple check the correct routing numbers before wiring money. Call the recipient via numbers you've obtained outside of the email to ensure wiring instructions are correct. Make sure they've received the money once you've sent it. I've been reading more reports of fraudulent addresses being sent via email resulting in large sums of money disappearing. Here is an example from today:

https://www.cnn.com/2020/07/12/us/ray-hu...

"Federal documents detailed how a paralegal at a New York law firm wired nearly $923,000 meant for a client's real estate refinancing to a bank account controlled by Abbas and his co-conspirators. The paralegal had received fraudulent wire instructions after sending an email to what appeared to be a bank email address but was later identified as a "spoofed" email address, the affidavit said."

Submitted by Coronita on July 12, 2020 - 9:00am.

yeah, before wiring money to an escrow account, make sure you call the escrow company and triple confirm the wiring instructions. When I was doing a 1031 exchange, the escrow companies were very very careful about it.

Submitted by barnaby33 on July 12, 2020 - 10:19am.

I did not pursue forbearance. As of now I've no need for one.
Josh

Submitted by treehugger on July 12, 2020 - 12:58pm.

I am in process of no cost no points refi to 2.75 with owning, am currently at 3.0, but at no cost decided to do it. Am going to check out the other places listed since we also have a rental condo currently at 3.5% and would love to get that down also!

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