My Lender is asking to pay additional poins to increase the down paymnet from 12% to 20%.
I am buying an new NV Home in woodstock, md. To get the discounted price on the home I asked me to go through their lender. NVR Mortgage. Initiall I said that I will put a down payment of 10% of 470,000 purchase price. To get out of jumbo i agreed to pay down difference of 470,000 nd 417,000. now I am in locking stage and ready to they offered me an intrestrate of 6.75. now I am planning to put down 20% to avoid PMI. when I told the same to lender they are saying I have to pay points to down more. I did not understand why so. the reason they are saying is you have out of PMI so you have to pay points. Can Any one advice
good afternoon.paying points doesn't increase the downpayment..it is considered pre-paid interst (discount points) to buy the rate down......to pay, say two points...there is a re-capture time of maybe five or more yrs.that you need to stay in the loan...to realize the savings of paying the points for recvg a lower rate..it is probably a $1.00 charge for a $.50 value.....don't get hung up on rate....what is it i am paying and what return do i see?.......bob mcclure- mortgage now- farmingt, michigan.........(248) 974-4444 direct cell.
SG-
I think your lender is giving you a bit of the run-around on your fee situation. It could be something sosimple as they have got you locked in a loan product and moving forward and now are upping the ante on you. By the way, there are few lenders right now who offer seconds up to 90% CLTV but I work for a retail bank that does. If you would like, I can do your purchase with 10% down, a $376,000 first mortgage and a $47,000 HELOC or 2nd Mortgage with no PMI. I am certain your rate would be at or below 6.75% as well.
Please don't think that you have run out of options. All I need is a 720 credit score and your debt ratio to be below 45%
Please don't hesitate to call me.
Luke Allison
Flagstar Bank
828-777-8828
Luke.Allison@flagstar.com
PMI & points are not connected. There should only be a difference in interest rate by paying points. Here is my blog on this subject.
http://activerain.com/blogsview/151273/What-is-a-Point
http://activerain.com/blogsview/150361/All-Mortgage-Rates-Are
Really? Ask them for a new Good Faith Estimate and Truth-In-Lending. Go talk to another loan officer about it that is familiar with your state's lending laws and regulations. Make them show you everything in writing and ask other loan officers if that sounds right.
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