Lender is charging a higher interest rate to cover your fees. Every loan transaction involves closing costs such as Title and escrow charges, Pre-paid interest and miscellaneous costs. These costs can be either paid by you at closing or incorporated in the loan term such through a slightly higher interest rate.... more
Myriam, Most lenders will do loans down to 30K to 50K; however, the issue is really in the pricing. There are lender add ons that will increase the rate and pricing on the loan. Additionally, the APR (annual percentage rate) is going to be pretty high because the closing costs are going to be high in proportion to the loan amount (the $400 appraisal fee is a much larger percentage on a 67K loan versus 300K loan).
In short, I have always been able to originate smaller loans; however, have also always felt the fees associated with originating them were just too high when I know I could refer the borrower to a local bank or credit union....and the borrower would save considerable funds. And, that is my recommendation to you: Start with a local credit union...they often portfolio (do not sell the loan on the secondary market) and you may find them very well priced. Next, try U.S. Bank (I can broker to them; however, that would add fees...not good, right???). U.S. Bank does a much better job than either BofA or Wells....and I would always recommend them over the others.
Best of luck to you! Certainly feel free to contact me if you have any questions that I can answer. Of course, you can keep me in mind for any referrals for larger loans that make more sense from a traditional mortgage platform.... more