Pleasantly Surprised with Loan Underwriting Time

txaggieinargyleApril 4, 2012

Just though I would pass this on. After hearing all the horror stories about mortgages these days I was worried that getting the construction loan setup would take a long time.

All my paperwork got to the bank on 4/2 and they just told me that I should expect to close on or before 4/20. That is less than 3 weeks.

I already owned the land so that probably made it easier. Either way I am happy with the process.

4.25% rate for the construction loan (not a jumbo loan)(Texas)

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mydreamhome

What a great rate!! Congrats! Looking forward to seeing your progress pics :-)

    Bookmark   April 4, 2012 at 8:27PM
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bevangel_i_h8_h0uzz

Congrats! What part of Texas will you be building in? I'm near Austin.

    Bookmark   April 4, 2012 at 10:03PM
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txaggieinargyle

DFW area

    Bookmark   April 5, 2012 at 1:14AM
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agentslim

Wow great rate. What bank? A local? Im not finding anything under 5% here in central california!

    Bookmark   April 5, 2012 at 3:32AM
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txaggieinargyle

Yes a local bank. Town Square Mortgage.

    Bookmark   April 5, 2012 at 12:23PM
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auroraborelis

Agentslim - for great rates in California try US Bank, theirs are as low as 3.5!

    Bookmark   April 5, 2012 at 2:49PM
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agentslim

Thanks Laura!

    Bookmark   April 6, 2012 at 12:59AM
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pbx2_gw

OP sounds like your 4.25% during construction is also 4.25% for the perm?

Did they lock you in already too?

If so, that is similar to our structure.

One rate throughout the life of the C to P.

    Bookmark   April 6, 2012 at 11:09AM
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txaggieinargyle

No the perm rate if locked in today would be 3.875% but they won't let me lock until 60 days prior to completion.

    Bookmark   April 6, 2012 at 4:15PM
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pbx2_gw

Then that is similar to other financing structure we looked at whereby you lock about 60 days out or could buy the lock guarantee for 1 pt now to hold on any upward movement but the construction rate is at prime or even at a higher personal loan rate. Too rich for our blood.

We decided to go with our current lender for 0 points & an APR of 4.1% effectively for the life of the loan from C to P.

    Bookmark   April 6, 2012 at 4:52PM
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brickeyee

"4.25% rate for the construction loan"

Construction loans are normally held by the originating bank.

They only have to satisfy themselves the risk is acceptable.

Most mortgages are sold into the secondary market.

The buyers there (Freddie, Fannie mainly) have there own rules.
If the bank packages the notes up they can sell bonds backed by the notes, but that usually takes a very large bank to even think about undertaking.

    Bookmark   April 6, 2012 at 5:53PM
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txaggieinargyle

brickeyee:

This was still the best deal i was able to find. The interim rate is 0.5 to 1.0% better than the other options I found. And their perm rate is really competitive with the open market.

    Bookmark   April 9, 2012 at 8:07AM
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auroraborelis

By perm rates, do you mean that you are locked into those rates for 30 years?

    Bookmark   April 9, 2012 at 1:11PM
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abdrury

"By perm rates, do you mean that you are locked into those rates for 30 years?"

Yes. Unless you chose to refinance at some point. If any of us are refinancing for a lower rate in the future that means something went (or continued to go) terribly, terribly wrong!

    Bookmark   April 9, 2012 at 6:39PM
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auroraborelis

Has anyone found a national bank doing decent perm rates? I can't find a local bank in my area (San Francisco Bay) offering this.

    Bookmark   April 10, 2012 at 3:15PM
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