Return to the Buying and Selling Homes Forum | Post a Follow-Up

 o
Fixed vs variable mortgage

Posted by holcombe3 (My Page) on
Fri, Feb 1, 13 at 10:43

Okay, I am really stressing over our loan decisions. We are getting a 550,000 loan for a new home construction. We planned on using our land as collateral so dont have quite the full 20% saved up. So in order for us to lock in our interest rate for 30 years, it would have to be sold to a mortgage company and the mortgage companies do require the 20% down, they wont accept land. So our other option presented to us was an ARM 5/5. Im going to talk with this lender tomorrow to see what the caps are. Am I crazy for even considering this route with interest rates so low? It would probably take us another year to save up the rest of the 20% down so interest rates may not be that low in a year. The thing that looks appealing to us with the ARM is the first 5 years interest rate is 3.25% and I could make double payments on this amount. So should I take the gamble of the ARM or wait it out another year to lock in a fixed rate?


Follow-Up Postings:

 o
RE: Fixed vs variable mortgage

Shop around more lenders. I would think that if the land is worthmore than the 20%, that some lender would be ok with it.
These interest rates have nowhere to go but up. And once they do, they will go up quickly, IMO. I will ask around in my circles to see of lenders are still acepting land as a DP. How much equity do you have in your land and how do you know this?


 o
RE: Fixed vs variable mortgage

Get a mortgage broker.

Lenders can only offer you what THEY have for sale.

A broker has access to multiple lenders.


 o
RE: Fixed vs variable mortgage

OP... one of the mortgage brokers that I use often tell me that most lenders will accept the equity on an owner's land for a construction to permanent loan.
I suggest dropping your current lender and moving on to another one.


 o Post a Follow-Up

Please Note: Only registered members are able to post messages to this forum.

    If you are a member, please log in.

    If you aren't yet a member, join now!


Return to the Buying and Selling Homes Forum

Information about Posting

  • You must be logged in to post a message. Once you are logged in, a posting window will appear at the bottom of the messages. If you are not a member, please register for an account.
  • Please review our Rules of Play before posting.
  • Posting is a two-step process. Once you have composed your message, you will be taken to the preview page. You will then have a chance to review your post, make changes and upload photos.
  • After posting your message, you may need to refresh the forum page in order to see it.
  • Before posting copyrighted material, please read about Copyright and Fair Use.
  • We have a strict no-advertising policy!
  • If you would like to practice posting or uploading photos, please visit our Test forum.
  • If you need assistance, please Contact Us and we will be happy to help.


Learn more about in-text links on this page here