Financing in Los Angeles>Question Details

Bobaboba, Home Buyer in Los Angeles, CA

Condo loan rate

Asked by Bobaboba, Los Angeles, CA Thu Jul 9, 2009

We are looking for a new loan. We found this retail loan lender (a bank) that posts a 5% rate today for a 30 year fixed loan.

We are buying a condo with 20% down.

We then were told by the lender that because we are buying a condo at 20%, there is a add on rate of 0.25 on top of the rate we see on their website.

Is there such a thing as 0.25 add on because it's a condo?

Please advise. thank you in advance!

Help the community by answering this question:


John B’s answer
I've heard that it's out there, but I'm really not sure how you can do it.

Look at this blog it will help you to learn more about your situation.
I've got most of my answers there as well.

Good Luck.
0 votes Thank Flag Link Tue Jul 21, 2009
Hi B,

I'm a Realtor not working in lending but I also have 20 years experience in the mortgage industry so for getting a simple answer to your question, I have heard our office in-house lender say that there are up-ticks for condos these days. Aside from the cost of money, rates are also determined by risk assessment. That's why the interest rate is higher for less money down too. The current market conditions have proven that the condo market is softer than the single family home market so there is a higher inherent risk for a lender/investor making a loan on a condo right now. This is not the first time in history that condo rates and terms have been different from those for single family homes.

Good luck,
Judith Gottesfeld
Web Reference:
0 votes Thank Flag Link Fri Jul 10, 2009
Hi Bobaboba,

The rates and also the other charges are not the only things to be compared.

Mortgage Planning is very very important. Mortgage is a long term commitment. Are you getting the best advice?
Web Reference:
0 votes Thank Flag Link Fri Jul 10, 2009

My guess is that your real issue is not the condo hit, but that this lender is making you feel like they're putting the genie back in the bottle. Consider these two scenarios:

1) Everybody responds with "Yes" on the blog. Does that make you feel good about 5.25%?
2) If the website rate was 4.75% and you were told the condo was 5.000%, do you still want to get 5.000%?

The point I'm trying to make is that you need to trust the lender before you get the rate quotes. Put your energy into finding the best person to help you, instead of into finding the lowest rate. And more than likely, you'll end up with the best rate too.

Let me know if I can help.

Best regards,

Rob Spinosa
0 votes Thank Flag Link Thu Jul 9, 2009
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