<palleg33[at]hotmail.com> wrote in message
news:1178154193.833540.224500[at]n76g2000hsh.googlegroups.com...

- quote -

Anyone thinking about getting a mortgage or refinancing, even people who
think they already know a lot about how mortgages work, would be well
advised to look at this website:

http://www.mtgprofessor.com/

It is an excellent place to find information about the ins and outs of
mortgages. It has saved me money by providing practical information. (The
site is not provided by a lending institution, and there are no sales
associated with it.)

Bill Woessner <woessner[at]gmail.com> writes:

- quote -

I don't know where BankRate.com gets their numbers from,
but the Freddie Mac Primary Market survey shows the average
for this week at 6.16% with 0.5 pts. That'd translate to
a touch more without the points.

Frankly, I trust Freddie's numbers more. And, in fact,
Bankrate has, on another page ("Interest Rate Roundup")
their _weekly_ survey showing 6.28% with 0.26 pts - much
more inline with Freddie's numbers.

One expects their "daily rate" to bounce around a bit
and diverge from the weekly one, but the full half-percent
difference they're showing seems a bit odd.

Anyway, 6-1/8 to 6-1/4 sounds pretty normal right now.

--
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No HTML in E-Mail! -- http://www.expita.com/nomime.html
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On May 3, 12:49 pm, "Daniel T." <danie...[at]earthlink.net> wrote:
- quote -

Probably. Who knows where BankRate.com gets those numbers from. But
the OP was contemplating an 80-10-10 mortgage. I believe that's
usually considered a 20% downpayment for purposes of the primary
mortgage (hence how you get around paying PMI).

Since everyone talked about spreadsheets, I put together one and put
it up for review:

http://woessner.dyndns.org:8080/~bill/Mortgage/

It shows that the 2nd option is the clear winner in terms of total
interest paid. I assume the variable interest rate for option one
stays at 7.75%.

--Bill

Bill Woessner <woessner[at]gmail.com> wrote:

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Don't bankrate.com's rates assume a 20% down?

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Always love the spreadsheets. I figured the same thing Joe did with
my 7.4% fixed second. Accelerating payments to pay off early is a
good move.

- quote -


both rates are fixed. You suggest only 5-7 years, life could change.
If you are going to own property and be highly leveraged, I think
fixed rate is the way to go.

Especially in the era of sub prime mortgages (variable rate mortgages)
causing problems.

Keep your costs fixed.

I also agree the rates look high. I just refinanced (last month) an
80-10-10 and got 5.75% on first and 7.4% on second, both 30 year fixed.

palleg33[at]hotmail.com wrote:
- quote -

Spreadsheeting this, I get (1) $628.35/mo (2) $620.23/mo (3) $625.40
plus PMI payment per $100,000. (note: I treat the cash down as 5%, for
'opportunity cost')

I don't like PMI, you may never get rid of it, given your timeline.
I'd choose (2) not just for the $8/mo savings over (1), but with rising
income, you can pay the 9% second back at an accelerated rate. Doubling
the payment drops the payback from 30 years to 7. I'd make that payoff
my priority, right after putting in matched 401(k) money (if you can).
JOE

In article <1178154193.833540.224500[at]n76g2000hsh.googlegroups.com> ,
palleg33[at]hotmail.com wrote:

- quote -

I don't like #2 because you have 30 years at 9%, and that is
too much to pay plus it negates the great interest rate on the
primary loan. That means picking between #1 and #3. I don't
like interest only deals since they tend to blow up and cause
big damage. That leaves #3. Since it is the lowest money
down, you have some extra cushion after closing. That in and
of itself is often a big factor.

Is there any chance you can scrape up 20% down? It looks
like you could get a 30 yr fixed at 6.125% if you did. Now
that would make a difference over the long haul. But if
you are staying only a few years, then the interest rate
really doesn't matter--with a short time horizon, you really
have to treat this like a rental deal (and a very expensive
rental at that).

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

On May 3, 6:32 am, palle...[at]hotmail.com wrote:
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Assuming prime - 1/2 stays where it is, option 2 is your best bet.
But if the prime rate plummets, again, the first option will become
attractive. That's the gamble you take with variable rate loans.

- quote -

I hope that's not getting in the way of you getting the best possible
mortgage. The rates you cited are on the high side. According to
BankRate.com, the average 30 year mortgage is currently at 5.76%.
That's not HUGELY less than what you quoted, but enough that it's
worth looking in to.

--Bill

I am in a conundrum and need some help.

Mortgage 1- 80% of value would be 30 yr fixed at 6.45 % 0 points, 10%
would be interest only of prime minus 0.5 and 10% down

Mortgage 2- 80% of value 30 yr fixed at 6.125%, 0 points, 10% would be
30 yr fixed at 9 percent and remaining 10% down

Mortgage 3- 93% of value 30 yr fixed at 6.5% with PMI and 7% down

I will probably live in this hous 3-6 years and my income will
significantly go up after year one of the loan.

What do you think?

By the way, I have some personal allegiance ot mortgage 1's bank

Thanks