How low can we go? 30 yr fixed at 3.75% with no fees...

does it make sense to asking for 3% credit for cash offers?  seems silly right?

i am looking at a short sale with bank approved asking and its had a few offers that have fallen out of escrow.  hence bank only wants cash offer and not 1 cent below their ask (it is priced low already so makes sense).  being the frugal minded and always looking for more, i would like to make the cash offer but still get back some. 
 
rkp said:
does it make sense to asking for 3% credit for cash offers?  seems silly right?

i am looking at a short sale with bank approved asking and its had a few offers that have fallen out of escrow.  hence bank only wants cash offer and not 1 cent below their ask (it is priced low already so makes sense).  being the frugal minded and always looking for more, i would like to make the cash offer but still get back some. 
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The 3% credit for closing costs is a use it or lose it thing so they will only credit you up to the closing costs.  For cash buyers, that'll be around .50% to .75% of the purchase price (depending upon property tax and HOA prorations).  Asking for a credit with short sales is completely different than asking for them on REOs.  My guess is that the short sale lender is looking at particular net sales proceed amount that they want so they may push back on your request even for a 1% credit for closing costs.  But hey, I would ask for it....if you don't ask then you'll never know.
 
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rkp said:
USCTrojanCPA said:
I got a buyer into contract on a Freddie Mac REO and negotiated a 3% credit for closing costs.  My buyer will use those points to buy down the rate to 3.50% (maybe as low as 3.25%) on a 30-year fixed conforming loan.
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When did the 3% credit for closing come enter the negotiations?  Do you write that in the initial offer or ask for it after opening escrow?
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Previously (and likely again in the future) HomePath? properties for Fannie Mae were eligible for up to a 3.5% of the agreed purchase price with some eligibility requirements:
Eligibility
?Buyer incentive must be requested at the initial offer submission.
?Initial offer must be submitted on or after April 11, 2011 (the effective date of the incentive program).
?The property sale must close on or before June 30, 2011 . No exceptions will be made to this deadline.
?Owner occupants only. Buyers purchasing a HomePath property as their primary residence may receive up to 3.5% of the final sales price towards closing cost assistance (second homes and investment properties are excluded). Additionally, buyers must sign the Owner Occupant Certification Rider to the Real Estate Purchase Addendum (available on the HomePath Resources page on efanniemae.com).
?Retail and public entities are eligible for the incentive; however pool and auction sales are NOT eligible. In certain instances where the insurer will not permit it, the incentive will not be available.
?Fannie Mae reserves the right to remove any property from the promotion or end the promotion at any time. Any dispute over the payment of the incentive shall be resolved by Fannie Mae in its sole discretion.

Currently Freddy Mac is currently offering 3% to the buyers of its HomeSteps? properties, similarly.
Full disclosure: The agents are offered an additional $1000, as well.
No negotiating necessary.http://www.homesteps.com/homebuyer/offers.html

DURATION OF OFFER: Offers received between November 15, 2011 and January 31, 2012 with escrow closed on or before March 15, 2012.

-IR2
 
IrvineRealtor said:
rkp said:
USCTrojanCPA said:
I got a buyer into contract on a Freddie Mac REO and negotiated a 3% credit for closing costs.  My buyer will use those points to buy down the rate to 3.50% (maybe as low as 3.25%) on a 30-year fixed conforming loan.
Click to expand...

When did the 3% credit for closing come enter the negotiations?  Do you write that in the initial offer or ask for it after opening escrow?
Click to expand...

Previously (and likely again in the future) HomePath? properties for Fannie Mae were eligible for up to a 3.5% of the agreed purchase price with some eligibility requirements:
Eligibility
?Buyer incentive must be requested at the initial offer submission.
?Initial offer must be submitted on or after April 11, 2011 (the effective date of the incentive program).
?The property sale must close on or before June 30, 2011 . No exceptions will be made to this deadline.
?Owner occupants only. Buyers purchasing a HomePath property as their primary residence may receive up to 3.5% of the final sales price towards closing cost assistance (second homes and investment properties are excluded). Additionally, buyers must sign the Owner Occupant Certification Rider to the Real Estate Purchase Addendum (available on the HomePath Resources page on efanniemae.com).
?Retail and public entities are eligible for the incentive; however pool and auction sales are NOT eligible. In certain instances where the insurer will not permit it, the incentive will not be available.
?Fannie Mae reserves the right to remove any property from the promotion or end the promotion at any time. Any dispute over the payment of the incentive shall be resolved by Fannie Mae in its sole discretion.

Currently Freddy Mac is currently offering 3% to the buyers of its HomeSteps? properties, similarly.
Full disclosure: The agents are offered an additional $1000, as well.
No negotiating necessary.http://www.homesteps.com/homebuyer/offers.html

DURATION OF OFFER: Offers received between November 15, 2011 and January 31, 2012 with escrow closed on or before March 15, 2012.

-IR2
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Yup, it is a Freddie Mac REO but I ask for 3% credit for REOs because it's a different beast.  If you read the fine print, that $1,000 bonus for agents is not available for sales in California. They also offer a 2-year HomeProtect home warranty for buyers.
 
When you buy a HomePath REO property and get the closing cost credit, FNMA does not pay "Owners Title" or some of the other fees you'd normally see a seller pay with a traditional sale. Because of this the 3.x concession you might get nets out to 2.x as some of that concession is used to pay the owners costs. If you're buying a HomePath or Home Steps property and are being offered a sales concession, try and ensure that it's for buyer charges only, not traditionally seller paid fees as well.

My .02c
 
Soylent Green Is People said:
When you buy a HomePath REO property and get the closing cost credit, FNMA does not pay "Owners Title" or some of the other fees you'd normally see a seller pay with a traditional sale. Because of this the 3.x concession you might get nets out to 2.x as some of that concession is used to pay the owners costs. If you're buying a HomePath or Home Steps property and are being offered a sales concession, try and ensure that it's for buyer charges only, not traditionally seller paid fees as well.

My .02c
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Received and reviewed the contract addendum for my buyer, looks like as long as we go with the escrow company that the REO seller selects the REO seller will pay for the owner's title policy and their share of the escrow fees (similar to all other REO addendums that I've seen).  The REO seller even paid for the termite repairs.
 
Looks like the Fed is on hold until at least late 2014.  10-year treasury bonds have responded by doing down 14bps.  I wouldn't be betting that rates are going up in the near term.
 
Japan 2.10

Features added
- More dividend and income strategies
- Less chance of inflating out of debt
- More unemployment
 
That reduction in the 10 year (and corresponding dip in Mortgage Backed Securities) might be enough to cover the .50 to .875 increase in some lenders rates because of the Agency Guarantee Fees that are starting to fade into the market. Most FHA insured loans are now solidly below 3.75% but we might not see as great of a push down in rates for all of the Fannie/Freddie loan products out there.

Some companies are quoting 10-15 day rate locks (assuming you can close before all G-Fee increases). If you ask for 45 or 60 day locks you should see how high they've gone up in the past week.

My .02c
 
SGIP-

so the agency fee increase is going to affect the rates across the board?  not just FHA or less than 20% down, but the wide market?

TIA
 
The Agency Fee increase has been implemented by many lenders on longer term locked loans. Most 15 day closing rates aren't yet seeing the impact, but loans locked longer (45-60) have seen on average a .50 to as high as .875 increase in fee. That fee increase translates into .125 to .25 in rate. We are starting to see the Freddie Mac Weekly Survey of lender rates creep up a bit partly due to the market, but certainly due to the Guarantee Fee increases. That Weekly Survey will get slammed back down because of yesterdays FedSpeak about 2014 rates, but in the long run that blip down will be swallowed up by the higher fees lenders are passing along.

FHA insured mortgage rates aren't impacted, but FHA Monthly Mortgage Insurance is. Per HUD sometime in March the 30 year MMI plan should rise from 1.1 per month to 1.2 or more. It's the slow boil that cooks an unaware frog.
 
IndieDev said:
Rates nudge even lower this week. Japan 2.0 it is.
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Yup, we are in a world of deleveraging for the near term so Japan 2.0 here we come.  I'll go out on a limb and say that the US 10-year bond yield will trade below 1.50% this year.
 
I'm in a battle with BofA to get 4.00%, 0 points, no fees and a 60 day lock on a jumbo conforming...wish me luck! *puts on headgear and grabs sword*

I fully believe that 3.75 or 3.875 is not unreasonable for a 30 day lock though.....

SGIP is the man and helping me out!!! Major props to him!
 
rimrattler6 said:
I'm in a battle with BofA to get 4.00%, 0 points, no fees and a 60 day lock on a jumbo conforming...wish me luck! *puts on headgear and grabs sword*

I fully believe that 3.75 or 3.875 is not unreasonable for a 30 day lock though.....

SGIP is the man and helping me out!!! Major props to him!
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Good luck with BofA...with my experience both their service and rates leave a lot to be desired.
 
IndieDev said:
BofA is barely solvent. Their offered rates should be in the high 7s.
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I'm guessing most of their loans get shipped out these days.  The .gov is the only entity willing to hold long term paper at 4%.  BofA is fighting over the scraps of razor thin origination fees just like every other lender is.  (No-cost loans have the fees built into the rate.)  BofA has economies of scale and doesn't need to spend much on marketing relative to their size which gives them an edge.  Continued government bailouts are contingent on extending credit to the American people, otherwise I wouldn't be surprised if they exited residential mortgage completely to focus on credit cards.  Lots of money to be made there.
 
freedomcm said:
3.50% with half a point!

At least on the interwebs.  Is it really possible to get that kind of rate today?
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Sure it is as long as your middle FICO is 740+ and you have a DTI below 40-45% and put 25% or more down and have documentable income for the past 2+ years.  These are getting to where it's almost free to borrow money (when you take into account inflation).
 
Big banks, no. Smaller mortgage bankers (like where I'm at now...) depends on circumstance, but difficult. Interweb lenders? Case by Case. AIM loan showed 1.5 points today. Amerisave showed .375. Both lenders had their own fees running about $1,200 (processing / appraisal, etc)  with title and escrow being charged based  on their preferred referral partners.

As noted earlier, you've got to be extraordinarily clean (75% LTV, impounding, standard income) and must close in 30 days. That's a steal frankly. If you can lock and close it in that time line, great!

My .02c
 
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