Home rate and term refinance at 3.125 with a minus .125 point credit

[ultrarunner]

With Interest Rates on deposits so low... I decided it would be a good time to revisit my home mortgage.

Mortgage is 8 years old and is adjustable... which means it has steadily dropped every year with a slight tick up last year to 3.375%

My same lender locked in a 30 year refi at 3.125% with a -.125 point... so it is actually a slight credit... plus this was not a cash out deal.

Everything looked great... 21 years on the job, excellent credit, 8 years history with lender etc...

I was also going for a 60% loan to value and would pay down any amount the appraisal falls short if necessary.

Appraiser seemed very fair and knows the area which is a plus... she also mentioned high rate of foreclosure and short sales in my zip.

Anyway, get notice lender has suspended my loan application... says they didn't realized I have a couple of rentals and my property is adjacent to my parents...

I specifically mentioned my rentals and all my income is declared and I use a CPA to do my taxes.

Lender said they have moved the file for manager review and will let me know... I stopped the appraisal because once done and no loan forthcoming, I would be out $480

Has anyone else run into refi problems owning a rental? All the rentals are free and clear except for one... some I have owned going back 30 years.

Makes me realize how screwed up the lending system is when something arbitrary like owning income property is a barrier to a home loan refi...

There was a time when owning a free and clear property would have made you golden...

 

[Tomtint]

Banks don't want to lend money at such short rates. They make more without taking the risk of a 15-30 yr mortgage. Banks are now in the business of making money on fees. It is a mess.

 

[ultrarunner]

Are you thinking rentals is just an excuse to not fund and the real reason is the rate lock at 3.125%

I thought just about all mortgages are sold with few being kept in house.

 

[Tomtint]

It depends who the bank is underwriting the loan with or who is in line to buy it. A few years ago we moved several accts to local credit unions and away from the big banks. At your local CU, decisions are made in house and the mortgage is typically carried and serviced in house as well. The objective of a CU is to help the community they serve. The objective of the large banks is a much different thing.

 

[ultrarunner]

I do have a credit union affiliation... never had a loan with them.

Regularly the bank that has my current home loan would send out offers soliciting loans.

Just thought I would go with them since they offered a great rate and we already did all the paperwork the first go round.

I have the option of keeping my current loan and dealing with annual rate changes as they occur since it is adjustable.

Figured I might as well take advantage of today's low loan rates since I'm taking it in the shorts on my deposit interest.

The bank doesn't even post them anymore... too embarrassed is my guess.

 

[BIG DOOLEY]

Are you thinking rentals is just an excuse to not fund and the real reason is the rate lock at 3.125%

I thought just about all mortgages are sold with few being kept in house.

Did you find out your credit score.
with theft identity on the rise, maybe there is a problem in the credit score?
I just paid ours off this year. we belong to a credit union but our mortgage wasn't.
I know some banks are easier to get a loan from others.
are the rentals on seperate parcels or on the same parcel as your house.
If they are not seperate (joined land) that might be the problem with no defined property lines?

 

[ultrarunner]

Credit score is 832

Rentals are about 5 miles away... same city, just not in the same part of the city as where my home is.

It just doesn't seem to make a lot of sense to have money in the bank at less than half of one percent and pay mortgage interest at 8 times that...

 

[s219]

Maybe they are skittish about some part of your income coming from rental property?? That's the only thing I could come up with. They sure are skittish about anything related to real estate these days.

 

[Deerherd]

Time to change banks. Well at least apply at another institution. You didn't state what your current rate is but your bank isn't motivated to lower it. They also know that after getting turned down, 50% of the people will think they can't get a loan and won't try anywhere else and they will keep them at the higher rate. Don't take it personal, its just numbers.

The days of long established relationships with banks are over, they really don't care. Oh sure they always smile and act like they care but not really. Now if you have MILLIONS in their bank they will care but then you wouldn't be pestering them about a small home loan, would you?

Find a mortgage specialist who only gets paid if they get you a mortgage. Now THAT person will work for you and if there is something in your credit report or financial situation the precludes you they can tell you what it is so you can go about fixing it.

 

[newbury]

Definitely check you credit union, and if you can get membership into the Navy Federal Credit Union try them.

NFCU is used to dealing with members "stranded" on ships worldwide and does very well with supporting members 24/7.

I've got 1 rental, my prime house in Va. and my retirement home in Mississippi and they have worked well with me with low rates for years.