Jumbo Mortgages

You, too, may personal a McMansion due to low jumbo charges – San Bernardino Solar


What’s stopping you?

Perhaps you can also afford a McMansion in Southern California. How about if you only pay interest and no amortization for the first three years with a mortgage rate of 1.875%?

A $ 1.5 million loan to a $ 2 million home has a home payment cap of $ 2,344. If your monthly property tax is $ 2,083 (1.25% annual property tax rate) and your monthly home insurance is $ 250, your total home payment is $ 4,677.

Lance Siegel, president of Lake Forest-based HVCC appraisal contracts, said it would cost about $ 6,000 a month to rent a $ 2 million home in Southern California.

Yes, you need good credit. You’ll need to redeem $ 500,000 for a deposit and earn over $ 30,000 as a settlement fee. Also, make sure you have Plan B ready within three years when your mortgage repayment plan begins and your principal, interest, tax, and insurance payments grow to around $ 9,300 per month.

However, the financing costs are ridiculously low at first.

If interest and payment uncertainties are causing too much heartburn, you’ll find a longer lock-up period of 5, 7, or 10 years in the 2% to 3% interest rate range on a 30-year mortgage. can do.

The 30-year jumbo fixed rate is also super cheap. Inland Empire properties with jumbo starting at $ 548,250 are only costing 2.375%. In Los Angeles and Orange Counties, where Jumbo starts at $ 822,375, the rate is just 2.625%.

What about all that easy-interest mortgage money?

It’s like finding the lowest water level. Just looking for a parking space and an advantage there is so much private capital.

The three-year interest-only program is currently particularly cheap, as investments are made in mortgages to hedge against possible inflation spikes and short-term interest rates are expected to rise in the coming years.

Investors are now because floating rate mortgages are recalculated based on the Secured Overnight Financing Rate (SOFR), a common benchmark that has replaced the damaged London Interbank Transaction Rate Index (LIBOR). And get long-term protection.

With a start rate of 1.875%, the average SOFR for 30 days would be 0.50. The return added to the index is 2.75%. If nothing changes during the three-year rollout, mortgage rates will jump to 3.25%.

Assuming no additional capital was added, McMansion’s total payout would nearly double from $ 2 million to $ 9,293 per month. This is an “amortized” payment of $ 1.5 million, 3.25%, plus taxes and insurance over the remaining 27 years.

The rent continues to rise. Readers and customers are increasingly complaining that there are no reasonable rental properties and few bargains.

If you buy it now without renting it, house prices will keep going up so it can look like a genius in three years. And you could make big equity profits with cheap and easy money. Or if the real estate boom collapses, you might regret doing such a trick.

It’s big business. But one thing is certain. That means you’re guaranteed to get cheap, almost free money for the next three years.

Freddie Mac Rate News: The 30-year fixed interest rate averaged 2.86%, two basis points lower than in the previous week. The 15-year fixed interest rate averaged 2.12%, 7 basis points lower than in the previous week.

The Mortgage Banking Association reported that the number of mortgage applications was unchanged from the previous week.

Diploma: Assuming the borrower receives an average 30 year fixed rate on an adjusted loan of $ 548,250, last year’s payments were $ 3 more than this week’s payments of $ 2,270.

What I see: On-site, qualified borrowers can take out the next fixed-rate mortgage for the price of 1 point: 30-year FHA 2.125%, 15-year conventional 1.875%, 30-year conventional 2.5%, 15-year conventional high balance ($ 548,251 to $ 822,375 ) is 1.99%, 30 years of conventional high balance 2.69%, 30 years of fixed jumbo 2.625%.

This week’s eye catcher loans: 15-year fixed interest rate of 2.375% without costs.

Jeff Lazerson is a mortgage broker. He can be contacted at 949-334-2424 or jlazerson@mortgagegrader.com.His website www.mortgagegrader.com.

You too could own a McMansion thanks to low jumbo rates – San Bernardino Sun Source link You too could own a McMansion thanks to low jumbo rates – San Bernardino Sun.