Rental property refinance in Plano tx

Asked by Lmf55, Dallas, TX Wed Mar 21, 2012

Are there refinance options available on a former residence, now rental property in Plano, Tx. We bought the home in 2002 for $2.2 million. I estimate current value at around $ 1.8 million. Loan balance is $1.3 million. Rate is fixed at 5.65 with 22 years to go ( we refinanced in 2004). We had a second mortgage but we paid it off. Our current primary residence is paid off. Credit rating is in 800's. We are willing to pay down loan on the rental house in order to get lower rate. We are into second year of three year lease and receive $13,000/ month in rent. 30 year fixed, 15 fixed, and 5/1, 7/1 arms would be considered.

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Bruce Lynn, Agent, Coppell, TX
Wed Mar 21, 2012
Do you want to keep the house for some reason?
You'd probably get better returns buying some other kind of rental property.

If you can find anybody to do this I don't think the rates are going to be a whole lot better.
Investment loans are normally about 1% higher than owner/occupied rates now.

My main lender showed owner occupied Jumbo Rates today of:
Jumbo 30yr Fixed - 5.125% (0.000 Discount Points)
Jumbo 15yr Fixed - 4.125% (0.000 Discount Points)
Jumbo 5/1 ARM (5/2/5 Caps) - 3.500% (0.000 Discount Points)
Jumbo 7/1 ARM (5/2/5 Caps) - 3.750% (0.000 Discount Points)
Jumbo 10/1 ARM (5/2/5 Caps) - 4.250% (0.000 Discount Points)

So going with one of the shorter ARMs might work. You have to have pretty good reserves probably, which I would guess you do. If you want a name, drop me an email and I'll send you a referral where you can check further. I'm sure they will have all kind of restrictions on $2mil single family rental property. That's way outside the box here.
0 votes
Does the 1% spread still apply to non owner occupied where loan to equity is very low? Say 30 or 40 %? We can pay down the loan if it makes sense for us to do so. We arent interested in discount points because we will probably put the house back on market in two years when current lease is up.
Flag Wed Mar 21, 2012
We are accidental landlords. When we put the house on the market two years ago, there was nary an offer. The luxury home market in Plano is very slow, nearly dead. On the other hand, our house rented within days of our putting it on offer and for more monthly rent than we expected, enough to cover interest, taxes and insurance on property. In fact, more than one tenant wanted the property and the tenant we selected pursued a three year lease. Outside the box, maybe. Challenging economy, for sure.
Flag Wed Mar 21, 2012
Jeremy Garcia, Agent, Dallas, TX
Wed Mar 21, 2012
our best 5/1 libor arm 4.000%
our best 10/ libor arm 4.25%
our best 30 year fixed 4.5%
our best 15 year fixed 4.0%
80% loan to value is required, in addition to 740 credit scores and full documented income for 2 years, in addition to rental schedules from your tax returns which we would need. If there is no rental income then we would order that analysis to be done with the appraisal.

APR's ranging from 4.184-4.875%, will there be fees to get these rates, most likely secondary marketing charges us for certain things when your loan doesnt fit the perfect mold, i then turn around and charge you those fees.

Now this is in a perfect world, which rarely happens.
0 votes
What if we reduced the loan to 400,000 or 500,000? Our loan to equity ratio would seem to make for a very low risk loan? Could we get the low coventional rates available today? I understand that we don't fit expected formula, but surely someone out there recognizes a good risk?
Flag Wed Mar 21, 2012
SO to answer your question, yes. And im sure you want to know what my company is going to make on the loan, its full disclosed as well. it will be less than .9
Flag Wed Mar 21, 2012
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