One of the lenders that I work with for Non-Owner Occupied rental property loans offers these unique loan aspects on 1-4 units:
1. No prepayment penalties
2. Up to 5 properties loaned on by the bank
3. Borrower can have up to 15 residential loans (commercial loans not counted)
4. Cash out loans up to 10 financed properties
5. Can use rental income for subject property with no history of managing a rental
6. Interest only payments
7. Investment property loans up to $2,500,000
8. Recoup funds from all-cash purchases as Rate & Term refinance up to 6 months
9. Full documentation & Alternative doc loans to qualify
Let me know if you are looking for new or refinance loans for your rental properties. I have great sources for best rate or alternative financing options as needed.
Showing posts with label Lending. Show all posts
Showing posts with label Lending. Show all posts
Tuesday, January 23, 2018
Friday, September 14, 2012
To Pay a Point or Not to Pay a Point?
Should a home loan borrower pay an additional point - think 1% of the
loan amount - to lower the rate of the loan over its amortization
period? The answer is: maybe....
The answer is in the arithmetic and what you think of the future.
First - if you pay an additional point - how much will the loan interest rate and the loan payment decrease of the life of the loan? And what is the recoup time to cover the point? If your loan payment goes down by $50 per month on a $100,000 loan and it costs you $1,000 to get this reduction - then the recoup time is 20 months. So, on a strictly numerical basis, if you keep the loan for more than 20 months, then the payment of the $1,000 is well worth it. If you happen to sell the home or refinance the loan before 20 months, then you have not achieved a full benefit of paying the point.
Second - What is interest rates move lower and you want to refinance to get a better rate. Your break even point is now $1,000 further away. This is neither good nor bad - just an issue of checking the arithmetic again.
And finally - who ever holds their loan for 30 years??? OK - that was a separate issue, but one that should be considered when thinking Rate, Term and Points.
For more info on lending:
www.HouseLoansLosAngeles.com
or www.CondoLoansLosAngeles.com
The answer is in the arithmetic and what you think of the future.
First - if you pay an additional point - how much will the loan interest rate and the loan payment decrease of the life of the loan? And what is the recoup time to cover the point? If your loan payment goes down by $50 per month on a $100,000 loan and it costs you $1,000 to get this reduction - then the recoup time is 20 months. So, on a strictly numerical basis, if you keep the loan for more than 20 months, then the payment of the $1,000 is well worth it. If you happen to sell the home or refinance the loan before 20 months, then you have not achieved a full benefit of paying the point.
Second - What is interest rates move lower and you want to refinance to get a better rate. Your break even point is now $1,000 further away. This is neither good nor bad - just an issue of checking the arithmetic again.
And finally - who ever holds their loan for 30 years??? OK - that was a separate issue, but one that should be considered when thinking Rate, Term and Points.
For more info on lending:
www.HouseLoansLosAngeles.com
or www.CondoLoansLosAngeles.com
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