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Old 02-13-2009, 10:15 PM
 
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Say a buyer is looking to buy a house for $600k (closing price, not listing), and has $125k to put down. Assume the buyer has a credit score over 700 and a strong six figure salary history ($150k-$200k in recent years, depending on the year). The property is in Connecticut.

What kind of rate can one reasonably expect to get for a 30 year fixed mortgage rate for a $475k loan and the above scenario? Am I correct that $475k in CT is a jumbo loan?
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Old 02-13-2009, 10:33 PM
 
Location: Knoxville
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A good rate, todays average is around 5.5, and you should not have any problems. In our area, anything over 417, is a jumbo.
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Old 02-13-2009, 10:37 PM
 
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Originally Posted by oldmanbob View Post
A good rate, todays average is around 5.5, and you should not have any problems. In our area, anything over 417, is a jumbo.
That 5.5 that you mention is for jumbo then? Meaning if I went below 417 I could get a lower rate?

And you mention that I should not have problems given the credit, income, etc. Just curious, why is it whenever I turn on the news people are saying that banks aren't lending and that even people good credit are getting rejected? Is that just total nonsense? (I trust your answer better than the TV news
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Old 02-14-2009, 06:03 AM
 
3,576 posts, read 5,903,599 times
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Quote:
Originally Posted by movingover View Post
Say a buyer is looking to buy a house for $600k (closing price, not listing), and has $125k to put down. Assume the buyer has a credit score over 700 and a strong six figure salary history ($150k-$200k in recent years, depending on the year). The property is in Connecticut.

What kind of rate can one reasonably expect to get for a 30 year fixed mortgage rate for a $475k loan and the above scenario? Am I correct that $475k in CT is a jumbo loan?
I had a similar situation as you. Looked into buying a over 675K home down in Florida. Was going to put down at least 30%. But in Florida, the jumbo rate (for Seminole county was still only 417K). So for jumbos at the 30 year fix, you are looking at the high 6%/low 7% range. I could have gotten a 7/1ARM WITH 30% down for about 5.625%. That's crazy (with respect to current 2009 mortgage interest rates and how low they are).

I went with a "cheaper" home in the mid 525K range. I put 108K range to drive loan down to 417K (conforming loan range) and got 4.875 30 year fix (paid 0.7 points).

So it all depends on what the temporary conforming rates are for YOUR specific county. I imagine in CT the conforming rates set by Freddie for this year are in the 475K range you mention. As loan as you are under that range you will get mortgage interest rates (for 30 year fix) in the high 4%/low 5%.

You do not want to be in the Jumbo range these days if you want a 30 year fix. There is still a market for 7/1 or 5/1 ARMs but they want at least 20-30% downpayment.
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Old 02-14-2009, 06:24 AM
 
Location: Palm Coast, Fl
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banks aren't lending and that even people good credit are getting rejected
I'm in Florida. I have had no difficulty with any of my buyers getting loans as long as their debt to income ratio was ok. If that's out of whack then yes, you will have a problem.
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Old 02-14-2009, 06:34 AM
 
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Originally Posted by palmcoasting View Post
I'm in Florida. I have had no difficulty with any of my buyers getting loans as long as their debt to income ratio was ok. If that's out of whack then yes, you will have a problem.
Definitely agree. The news media is keeps reporting how hard it is to get a loan. I got my loan approved in 3 days in Florida..

But it all depends on your income level. How strong you are financially.

If you are on "shaky" financial grounds or have very high monthly debt, you will have problems getting a mortgage approved.
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Old 02-14-2009, 06:39 PM
 
161 posts, read 550,870 times
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Quote:
Originally Posted by aneftp View Post
I had a similar situation as you. Looked into buying a over 675K home down in Florida. Was going to put down at least 30%. But in Florida, the jumbo rate (for Seminole county was still only 417K). So for jumbos at the 30 year fix, you are looking at the high 6%/low 7% range. I could have gotten a 7/1ARM WITH 30% down for about 5.625%. That's crazy (with respect to current 2009 mortgage interest rates and how low they are).

I went with a "cheaper" home in the mid 525K range. I put 108K range to drive loan down to 417K (conforming loan range) and got 4.875 30 year fix (paid 0.7 points).

So it all depends on what the temporary conforming rates are for YOUR specific county. I imagine in CT the conforming rates set by Freddie for this year are in the 475K range you mention. As loan as you are under that range you will get mortgage interest rates (for 30 year fix) in the high 4%/low 5%.

You do not want to be in the Jumbo range these days if you want a 30 year fix. There is still a market for 7/1 or 5/1 ARMs but they want at least 20-30% downpayment.
I'm a bit confused but thanks for your post. I thought I checked the Fannie/Freddie site and it seems like the jumbo is for anything that is over $417, with only a few exceptions like Alaska and Hawaii. Where do you go to see rates by county or state? I think that is insane for CT to have jumbos at anything over $417, anyone who knows the area understands how expensive houses are there, but whatever.

If it turns out that $475k in CT is a jumbo, and if I can get a jumbo for 5.75%, should I jump on that? I see one bank offering this rate for non conforming 30 year fixed.
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Old 02-15-2009, 05:53 AM
 
945 posts, read 1,737,132 times
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Quote:
Originally Posted by movingover View Post
I'm a bit confused but thanks for your post. I thought I checked the Fannie/Freddie site and it seems like the jumbo is for anything that is over $417, with only a few exceptions like Alaska and Hawaii. Where do you go to see rates by county or state? I think that is insane for CT to have jumbos at anything over $417, anyone who knows the area understands how expensive houses are there, but whatever.

If it turns out that $475k in CT is a jumbo, and if I can get a jumbo for 5.75%, should I jump on that? I see one bank offering this rate for non conforming 30 year fixed.

I think I can help. The jumbo rate in IL is also $417. We built and closed before selling our previous home. The home was $660k, we put 10% cash down, took the max $417 as orginal mortgage and the remainder ($180k) was a "bridge", per say, at a higher rate of 7.75/10year. We did this because we knew it would be temporary and until we sold the other home, would have our equity tied up. Once we sold (8/08), we paid off the "second", recasted the original $417 down to $370,000, and after all said and done, re-fied at 4.85 (even though we had just recasted) when interest rates were there back before the holidays (so incredible). The original jumbo (now not a jumbo at $370k) was originally at 6.5% 30yr. fix. In your case, you could do the jumbo at your 5.75%, and take a "second" on the remaining 58k at the higher rate. Perhaps you could pay down the second with extra to the principle each month and have that one paid off in a few years. I'd take no less than a 10yr. on the second, though, just in case. It's very workable and as long as your income supports the ability, you'll be fine. I do, however, wonder why the jumbo is so low in many states. I know it was said that some raised it to over $700k for a short term, but not here. If one qualifies, the low interest rates should be available on any amount, in my OP. Just the systems way of making another "buck" on someone elses' money I guess. Of course, these are the types of borrowers who actually PAY their mortgages! Good luck and congrats on your new home!
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Old 02-15-2009, 01:51 PM
 
161 posts, read 550,870 times
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Quote:
Originally Posted by fairmarketvalue View Post
In your case, you could do the jumbo at your 5.75%, and take a "second" on the remaining 58k at the higher rate.
Do you mean I can take the conforming loan on the first 417k (at say 5.15%) and then take a bridge loan on the remaining 58k? Would a bridge loan be in the form of a personal signature loan or is it considered a real-estate loan? I'm guessing its a personal signature loan with no collateral? Doesn't that have a pretty high interest rate?
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