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We are in the process of buying a new house - contract is signed, colors are picked, mortgage applied for, etc. - and with all that's going on in the mortgage world, I am freaking out!
Normally, my husband and I are a good financial risk - a good 100% verifiable income, full corporate relocation to cover all closing costs and a buy-out on our current home, 750 credit score, 10% downpayment - however, with all I am reading, I am still so nervous about getting financing.
We won't be ready to lock in a rate until the middle of September, what do you all think is going to happen at the fed meeting on Sept 18th? If they cut rates will it help us?
I guess I'm just looking for some reassurance - Thanks!
Location: Sometimes Maryland, sometimes NoVA. Depends on the day of the week
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Well, the fed just cut rates, so I don't know if they will do it again. It sounds like you are a very good candidate, so I wouldn't worry so much about having you loan yanked from you due to changes in underwriting. But, I have been hearing about people whose lenders filed for bankruptcy or otherwise reneged on loan promises hours before closing. We bought in May, and were a bit concerned that we could get hit by changes in underwriting. If I were buying again today, I'd be more worried about lender solvency.
It sounds like you won't be closing under Oct or Nov (based on 30 to 60 day locks), keep your fingers crossed this mess starts to settle by then.
If the Feds continue to cut the rates....that might have an adverse on the 10yr bonds.
Generally, when the market is doing good, then the bonds are down.
When the market is doing bad, then the bonds are up.
I have looked at ratesheets with different lenders, and they have gone up since the Fed dropped the 'discount rate'.
In the year 2001 we had a market crash due to 9/11.
Rates were at the lowest it's EVER BEEN.
Also, remember if you're working with the builder's lender, that they may have a set margin. The margin is the difference for what they receive the rate as, and what they sell it to you for.
Look at the 10yr bond rates when hoping to lock your rate.
Also, HOPE THAT THE BUILDER is finished with the house before the rate lock expires!!!!
Otherwise you will pay for a rate lock extension.
We are in the process of buying a new house - contract is signed, colors are picked, mortgage applied for, etc. - and with all that's going on in the mortgage world, I am freaking out!
Normally, my husband and I are a good financial risk - a good 100% verifiable income, full corporate relocation to cover all closing costs and a buy-out on our current home, 750 credit score, 10% downpayment - however, with all I am reading, I am still so nervous about getting financing.
We won't be ready to lock in a rate until the middle of September, what do you all think is going to happen at the fed meeting on Sept 18th? If they cut rates will it help us?
I guess I'm just looking for some reassurance - Thanks!
You have NOTHING to worry about!! If what you say is true it will be a breeze, asumming you aren't trying to get a house you truly can't afford.
If you're within the conforming loan limit then you're a golden borrower with your scores and proving your income. Even if you're above, you have nothing to worry about other than jumbo rates being high right now. All of the guideline changes have been driven by the sub prime and alt a specialty loans defaulting and freaking out investors. They've eliminated the extremely risky loans, and want to be paid more for their risk on the rest of the loans.
You don't fit into any of the concerns of investors, so it won't effect you other than rates being driven up in general. That's about the only negative.
Also, keep in mind the newspapers and news stations motto... the worst news is the best news... they always make things sound worse than they are so freaked out people watch their shows from the edge of the couch.
KristyLiz
You my dear are "driving the bus" You are the type of borrower that can actually say "the bank needs me more than I need them" This gives you great bargaining power. For example:
When we thought we were being transfered and had put in a contract with the builder in the new area, we got the typical "if you use our lender we will give you $$$$"
From the start told them I had no problem using their lender but to keep in mind that not only was my credit score 808 but I had 30 ys in the "business" So if they were up front and honest there would be no problem"
45 days before projected closing I asked for a good faith settlement est and "went shopping"
I called USAA who we have our ins through and asked "based on this credit score and these figures can you send me a closing cost est." This way they won't pull a credit report unless I ended up using them.
Well wouldn't you know not only was the builder lenders closing cost $5500 higher but their rate was also higher.
"Busted" can you guess who I called next. lol you can't imagine the "tap dance " I got from my loan person at the builders lender. I gently reminded him "What part of I have 30 years in the business did you forget"
It turned out for the best that the transfer did not go through and again because of my background I was able to get our $5k earnest money back.
So KristyLiz don't worry go out and have some fun and make them earn your business. A simple "With our credit scores and situation maybe I should get some comparisons" will have the builders lender if that who you are using wake up.
To bad I am not in your area, doing this is so much fun I would sit with you and make those calls
You have NOTHING to worry about!! If what you say is true it will be a breeze, asumming you aren't trying to get a house you truly can't afford.
I really, really hope you're right. Thanks for the reassurance
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