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Old 09-28-2012, 06:23 PM
 
470 posts, read 999,083 times
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I know no one has a crystal ball but the 30 year fixed rate is 3 3/8 right now. Should I do a 60 day lock? or should i just let it ride?
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Old 09-28-2012, 07:13 PM
 
Location: Austin
7,080 posts, read 16,908,498 times
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A 60 day lock is going to cost you more than a 30-45 day lock. You won't get today's par rate with such a long lock period.
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Old 09-29-2012, 04:16 AM
 
470 posts, read 999,083 times
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How if the rates go up a 1/4 percent or 1/2 percent next month and I miss out on the historic low rate of today?
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Old 09-29-2012, 04:54 AM
 
Location: Wake Forest, NC
835 posts, read 3,529,870 times
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You question is part of the answer to your own question- would you feel worse about locking and rate dropping an .125% or floating and it going up .25%?
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Old 09-29-2012, 07:25 AM
 
Location: New Jersey
8,145 posts, read 11,880,506 times
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Quote:
Originally Posted by dad2jules View Post
You question is part of the answer to your own question- would you feel worse about locking and rate dropping an .125% or floating and it going up .25%?
That's exactly what I always tell my clients and my wife as we're in the process of selling and buying.
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Old 09-29-2012, 08:40 AM
 
Location: MID ATLANTIC
7,602 posts, read 17,639,445 times
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With a 60 day lock ask your lender if they will renegotiate the lock if there is a significant market improvement within 30 days of closing. This is not to be confused with a "float down," where you pay for the privilege of getting a lower than the locked rate. Several of the major behind the scenes investors will renegotiate their locks when there is a sudden drop.

If the lender will not renegotiate the lock, the buyer needs to make the decision whether it's worth the time, money and aggrevation to apply with second lender. This is the most expensive investment someone will ever make and needs to be treated as such.
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Old 09-29-2012, 04:08 PM
 
Location: Chandler
32 posts, read 141,782 times
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Rates are going down...
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Old 10-04-2012, 11:31 AM
 
Location: Charleston, SC
2,810 posts, read 2,810,268 times
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Yea man, rates are continuing to drop...wait at least to the end of the year...
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Old 10-08-2012, 04:50 PM
 
Location: New York
2,251 posts, read 4,164,578 times
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A decade plus in the mortgage business. The fed adjusts the prime lending rate charged to banks twice a year, on June 15th and Nov 15 (except during election years). I predict rates wil stay the same till next May, when there is talk the rates are going to raise.

Every Tom, Dick an Harry Mortgage Broker starts crying "The Rates Are Going Up" like it's the end of the world. Come June 16th, the rate adjusts 1/8 to 1/4 of a point......

Do yourself a favor - divide one payment by 12, add that to your normal payment. This will equal an extra payment by years end. This reduces the term to 23.5 years, reduces your net effective rate by 2%, and your get reported as being more responsible - as a result your credit score goes really high...

Good Luck..
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Old 10-08-2012, 10:39 PM
 
1,784 posts, read 2,879,729 times
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Quote:
Originally Posted by Modification Specialist View Post

Do yourself a favor - divide one payment by 12, add that to your normal payment. This will equal an extra payment by years end. This reduces the term to 23.5 years, reduces your net effective rate by 2%, and your get reported as being more responsible - as a result your credit score goes really high...
You keep saying this on multiple threads, but it's deceiving in such a low interest rate environment, and people should realize their term is reduced by much less. I'll copy from my response in another thread:

I took the monthly payment and applied an extra one at the end of each year.*

Interest Rate | Time saved on Mortgage

1% | 2 y 7 mo
2% | 3 y
3% | 3 y 5 mo
4% | 4 y
5% | 4 y 7 mo
6% | 5 y 3 mo
7% | 6 y
8% | 6 y 11 mo
9% | 7 y 9 mo
10% | 8 y 8 mo

So more like 26+ years, not 23.5. Still quite good, but not as good as you make it sound.


* You could also do the extra 1/12th of a payment each month, but it's pretty negligible. There's no difference at 1%, and about 3 months benefit at 10%.
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