What's going into escrow - Irvine and maybe some Tustin too

It's quite simple to calculate the benefit. You simply take the cost of the additional point(s) and divide it by the monthly payment savings. Points will reduce the rate more for an ARM than a fixed rate, because you have less time to make up the costs.



Think of it like the duration of a bond. When buying a bond, in the immediate short term price difference matters most, but over time (past the point of duration) your monthly interest outweighs price.
 
[quote author="Masterofdamoney" date=1213360222][quote author="graphrix" date=1213337544]Here are the wholesale rates from one lender. The numbers to the right are a cost or in (a rebate) or YSP. A broker who is hungry could do a deal 6.625%, making .75% in rebate, and not charge any points.



http://img801.mytextgraphics.com/photolava/2008/06/12/30yrconf612-4atvmt7z6.jpeg



Here is the "jumbo" conforming.



http://img902.mytextgraphics.com/photolava/2008/06/12/30yrjconf612-4atvnv5u8.jpeg



These rates are current as of 1pm rate change, and come tomorrow they could get worse.</blockquote>


Those smell like the rates from the bank I love to hate. :)



You know, the one that advertises attractive rates/pricing but fails to mention the mandatory .25 - .50 pricing hit for declining market (which applies to EVERY CITY AND STATE IN AMERICA WHEN YOU ACTUALLY PRICE IT), in addition to the mandatory .25-.50 hits for non-cashout refi, cashout refi, state specific pricing hits, and mandatory lock pricing hits.



Hate hate hate. :) It's like, here's your 6.5 at par! Er... actually you're doing a no-cashout streamline refi in CA with a 12 day lock? That'll cost ya 1.0! Thanks!</blockquote>


Nah... they are not that evil. If you take in all the adds (high credit score and low LTV) and minuses (adverse market fees, etc.), then the pricing at par is pretty much par, give or take an 1/8th on pricing. I *cough*hint*cough* they are local, very local, and Padilla/CR blogs about them and their increase in NPAs all the time. Think option ARM laggard, opposite of leader, that doesn't PW protect their rate sheets.



You can still hate them, as they deserve hate for many reasons, just not the reasons for hate you mention. :coolhmm:
 
[quote author="Roo" date=1213348813]Why would someone buy points? Why not use that money for downpayment? I understand that it lowers your interest rate, hence your monthly payment. However, if it's better to buy points rather than using the money for downpayment, shouldn't you only buy points and use 0% downpayment (if possible). If it's not better than downpayment, why use it at all?</blockquote>


Okay... here we go again, but for fun, I will play.



A $500k loan amount reduced by 1.5% $492,500 (the points you might pay) for a non-hungry broker would get you 6.75%, and after ten years you look like this...



2018: principal balance $415,049.31: interest paid $28,383.32: principal reduction $9,948.82: total interest paid $325,036.87



A $500k loan amount, at a 6.25% rate bought down by 1.5% points, and after ten years you look like this...



2018: principal balance $415,809.58: interest paid $26,350.13: principal reduction $10,592.90: total interest paid $303,711.42



Give it five more years, and the one who didn't pay points will look like a complete fool. You need to do the math for how long you plan on living there, otherwise you can look like a fool either way.



If you are like Ipo, and change your mind everyday, driving IR2 nuts, then don't pay points and get the shortest term loan you can find. But, if you are planning on being there for a while, then pay the points and get that rate down, unless you like paying more in interest over the years, then that is cool, the banks need to make some money.
 
[quote author="lendingmaestro" date=1213363287]It's quite simple to calculate the benefit. You simply take the cost of the additional point(s) and divide it by the monthly payment savings. Points will reduce the rate more for an ARM than a fixed rate, because you have less time to make up the costs.



Think of it like the duration of a bond. When buying a bond, in the immediate short term price difference matters most, but over time (past the point of duration) your monthly interest outweighs price.</blockquote>


Sorry, LM, I meant I had never figured the tax difference between paying the points up front or paying extra interest.
 
[quote author="graphrix" date=1213373143]

Give it five more years, and the one who didn't pay points will look like a complete fool. You need to do the math for how long you plan on living there, otherwise you can look like a fool either way.

</blockquote>


Rule of thumb. 1 point - 0.25% on the rate and you are ahead in 36 months.



(Okay, my thumb is wrong, looks like breakeven is just before 48 months.)
 
That <a href="http://www.redfin.com/CA/Irvine/9-Paso-Robles-92602/home/5770551">9 Paso Robles</a> house that IrvineRenter posted about yesterday? According to Redfin, it's taking backup offers now. That was quick.
 
[quote author="graphrix" date=1213373143]If you are like Ipo, and change your mind everyday, driving IR2 nuts, then don't pay points and get the shortest term loan you can find. But, if you are planning on being there for a while, then pay the points and get that rate down, unless you like paying more in interest over the years, then that is cool, the banks need to make some money.</blockquote>


Sometimes I am just too cerebral for my own good graph. I decide something and a whole new and more powerful group of brain cells rethinks it and voila, a new and improved conclusion is formulated... At least now that I have doled out over $8K in rent, security deposit, etc. there is no turning back. IR2 finally gets to sell my condo and make some money off me.



That IR2 is a good man. He helped me unload my new/used Craiglist couch and loveseat from the ole Uhaul trailer this morning. Man I love Craigslist! Picked up a nice desk out in RSM today too. Bought it from a woman, who now has her daughter and her daughter's children living with her in her smallish condo. The woman and the daughter both formerly worked in mortgage, one as an underwriter the other as a funder, and now have both lost their jobs... I felt bad enough for them that I didn't even try to haggle them down on price and I ALWAYS haggle.
 
[quote author="No_Such_Reality" date=1213398840][quote author="graphrix" date=1213373143]

Give it five more years, and the one who didn't pay points will look like a complete fool. You need to do the math for how long you plan on living there, otherwise you can look like a fool either way.

</blockquote>


Rule of thumb. 1 point - 0.25% on the rate and you are ahead in 36 months.



(Okay, my thumb is wrong, looks like breakeven is just before 48 months.)</blockquote>


It's not really how long you are going to live in the home, its how long you are going to keep the particular loan... If there is a high refi expectation, e.g. maybe buying when rates are very high, one could own the home for 20 years but the pay points calc might use many less years due to future refi.
 
[quote author="ipoplaya" date=1213444924]Sometimes I am just too cerebral for my own good graph. I decide something and a whole new and more powerful group of brain cells rethinks it and voila, a new and improved conclusion is formulated... At least now that I have doled out over $8K in rent, security deposit, etc. there is no turning back. IR2 finally gets to sell my condo and make some money off me.</blockquote>


Ah... cerebral change is good, and I have to admit my brain cells will hibernate for a while, then come alive with another new and approved idea too. Those brain cells woke up on buying Lehman puts and selling them on Thursday for nice little profit. That, and they will realize when being a hard headed fool can make you be a fool. Looks like we have something in common after all that back and forth from the early days.



IR2 is good man. He has rejected the Kool-Aid, and does his job and does it well. Thank gawd he finally gets to make some money off you, too bad it will be only $1.34 a hour, but he can move forward with a new graft of much needed plugs.



<blockquote>That IR2 is a good man. He helped me unload my new/used Craiglist couch and loveseat from the ole Uhaul trailer this morning. Man I love Craigslist! Picked up a nice desk out in RSM today too. Bought it from a woman, who now has her daughter and her daughter's children living with her in her smallish condo. The woman and the daughter both formerly worked in mortgage, one as an underwriter the other as a funder, and now have both lost their jobs... I felt bad enough for them that I didn't even try to haggle them down on price and I ALWAYS haggle.</blockquote>


Yeah... it is pretty sad how there are some innocent victims in this bloodbath. You are a bigger person for not haggling, and it will come back to you. Maybe even a buyer over the weekend. As I was pouring through the abundance of NODs this month, and I caught a name I recognized. Long story, but she was a ten, who was in mortgage making the big bucks with a LV bag that said multiple validations all over it. She was a well together [strike]chick[/strike] woman, who was doing very well in the biz, and better than most. She drank the Kool-Aid though, and now is facing foreclosure. While I enjoy all the foreclosures, and plan on taking advantage of it, there are some very sad stories behind some of them.
 
Ten's fave, 14 Mar Vista in NP, has pierced the $1M. It closed on 5/30 for $990K... That will hopefully kill some comps.



Bunch of other closings as well...



<a href="http://www.ipoplaya.com/">IPOPlaya's Site</a>
 
51 Momento in QH finally update MLS with closing data. Closed on 5/31 for $1.60M. Previous purchase was $1.83M in April 2005. Almost cracked sub-200 on Case-Shiller...
 
[quote author="ipoplaya" date=1213479531]Ten's fave, 14 Mar Vista in NP, has pierced the $1M. It closed on 5/30 for $990K... That will hopefully kill some comps.



Bunch of other closings as well...



<a href="http://www.ipoplaya.com/">IPOPlaya's Site</a></blockquote>


Yeah, I saw that too.

Fire the confetti cannon.

First time, long time since I?ve seen 3,000sq.ft. under $1M in Northpark.

Hopefully, there?s more to come.
 
[quote author="muffdaddy" date=1213425619]That <a href="http://www.redfin.com/CA/Irvine/9-Paso-Robles-92602/home/5770551">9 Paso Robles</a> house that IrvineRenter posted about yesterday? According to Redfin, it's taking backup offers now. That was quick.</blockquote>


The price/sq. foot on Paso Robles is very encouraging, which is why I believe it was taken down.

Great deal, imo.

Cambria is the absolute cream (MVP) of Northpark.

Never expected to see those homes in that range.

Pure Bliss!
 
[quote author="tenmagnet" date=1213830483][quote author="muffdaddy" date=1213425619]That <a href="http://www.redfin.com/CA/Irvine/9-Paso-Robles-92602/home/5770551">9 Paso Robles</a> house that IrvineRenter posted about yesterday? According to Redfin, it's taking backup offers now. That was quick.</blockquote>


The price/sq. foot on Paso Robles is very encouraging, which is why I believe it was taken down.

Great deal, imo.

Cambria is the absolute cream (MVP) of Northpark.

Never expected to see those homes in that range.

Pure Bliss!</blockquote>


Anyone know what the attempted closing price is? I know some people who own the same model...
 
[quote author="25w100k+" date=1213838371][quote author="tenmagnet" date=1213830483][quote author="muffdaddy" date=1213425619]That <a href="http://www.redfin.com/CA/Irvine/9-Paso-Robles-92602/home/5770551">9 Paso Robles</a> house that IrvineRenter posted about yesterday? According to Redfin, it's taking backup offers now. That was quick.</blockquote>


The price/sq. foot on Paso Robles is very encouraging, which is why I believe it was taken down.

Great deal, imo.

Cambria is the absolute cream (MVP) of Northpark.

Never expected to see those homes in that range.

Pure Bliss!</blockquote>


Anyone know what the attempted closing price is? I know some people who own the same model...</blockquote>


Love it!

Hey man, you should be worried.

Better tell your folks to cut their price and sell to me before I lose interest.

We?re only off by $200K.

What you think I didn?t know?



What?s left of your self-esteem will be decimated once I hang the huge Cardinal & Gold, Trojan Pride flag up in front of my trophy house where it rightfully belongs.

I keep telling you, tighten up that game, and beef up that bank account, maybe someday.

?Anything?s Possible? worked for KG

(Smiley)
 
[quote author="tenmagnet" date=1213849039]



What?s left of your self-esteem will be decimated once I hang the huge Cardinal & Gold, Trojan Pride flag up in front of my trophy house where it rightfully belongs.

I keep telling you, tighten up that game, and beef up that bank account, maybe someday.

?Anything?s Possible? worked for KG

(Smiley)</blockquote>


I don't have any beef with Trojans. Good football team, decent education that isn't anymore of a ripoff then any college education. ;-)



Buy the house, fly the flag proud! I'll stop by to share a mickeys on the way over to visit my parents.
 
Big house in Tustin Ranch closed yesterday for $1.55M. Amazingly, at that price, it was a monster rollback. They paid $775K in March '98...



June continues to be another up month in terms of prices but the sample is still pretty small.



<a href="http://www.ipoplaya.com/iposhiller.pdf">Updated IPO-Shiller</a>
 
[quote author="ipoplaya" date=1213849901]Big house in Tustin Ranch closed yesterday for $1.55M. Amazingly, at that price, it was a monster rollback. They paid $775K in March '98...



June continues to be another up month in terms of prices but the sample is still pretty small.



<a href="http://www.ipoplaya.com/iposhiller.pdf">Updated IPO-Shiller</a></blockquote>


Are you talking about the one on Lindsey Ct?

I saw $1.45M in ?04
 
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