Conference nyoss1::market_investing

According to an article I read a couple of days ago (and according to ads
in the paper), you can get around 8% with 2 points.

    re: .0
    
    Check the Saturday Boston Globe. They usually list the going mortgage
    and car loan rate for many banks around the Boston area. This gives you
    an idea of how the DCU rates compare with other banks.
    

    re: .2
    
    Thanks, but I am not in Boston. I am in Colorado Springs.
    I will check local papers.
    

I just locked in a 30 yr. fixed rate of 8.125 with DCU on 7/2.  It cost me 3/4 
of a point for the 8.125 rate.

	These were the rates that they were offering on 7/2:

	7.875 ....... 2.25 points
	8.000 ....... 1.50 points
	8.125 .......  .75 points
	8.250 .......    0 points

The application fee was $300.00 (includes appraisal and credit report) and is 
non-refundable.  To lock in the rate I had to pay 1 point up front. this point
is applied towards points and/or other fees at closing.

Bob

    Lawrence saving bank  508-687-1131 : ask for the rate line
    
    As of 7/8     :  15 year
    
    0 point  8.0
    1 point  7.75
    2 points 7.625
    
    	I just made my first payment on a 0 point with a rate of 8.65.
    	I may just go for a lower rate if it drops anymore. closing costs
    	were around $ 1,200.00
    
    Brian

The DCU rates seem high compared with what I've been finding.  I use a 
mortgage broker here in Atlanta and am going through my second refinancing 
now.  I have 8.25% on a 7/23 with no closing costs.  What this means is that 
the closing costs are covered by a higher than normal interest rate.  That 
way I can refinance again if rates drop as little as 1/4 point.  The first 
time I refinanced I did have a credit report fee and appraisal fee, but now 
those are still good.  My current loan is at 8.875%.  Only a mortgage broker 
will allow you to do this as they make a commission each time you close.  A 
bank would get upset since they would lose all that interest.  I also found I 
got better rates from a broker.  A 7/23 loan is convertible to a 30 year loan 
at 1/2 point above the prevailing rate, but very few people stay in a house 
for 7 years.  The rate for a 15 year no cost is about 8.5%.

              -< Rates as of Jul 14 >-
    
    BayBank:
    
    15 yr Fixed:
    
    7.49% 2 Pts
    7.8%  1 Pt
    8.1%  0 Pt
    
    Citicorp:
    
    15 yr Fixed:
    
    8.37% 0 Pts
    
    Boston Federal Savings:
    
    10 yr Fixed:
    
    7.375% 1.5 Pts
    
    I have a balance of $76,000 with 9 yrs to go on a 9.5% 15 yr mortgage.
    I am thinking of refinancing. Which one of the above mortgages am I
    better of?? I am thinking of paying the same monthly amount I pay now
    which is $1045. Will any of the above put me on better track in paying
    off my debt earlier? BayBank also has a biweekly. Is that any better?
    
    Any advice will be greatly appreciated. Thanks in advance.
    
    -Atul

    Note that Baybank has an unadvertised deal for Digital employees:
    
    	o  1/2 point off the 2-point mortgage
    
    	o  $150 application fee (rather than $250 ?)
    
    	o  attorney fee capped at $500 (may need to be a refinance for this)
    
    You may find Baybank employees who deny the existence of this plan.
    Push back - it's there.

    re .7  I'm in a similiar situation and am not even considering
    15 year mortgages; I'd go with the 10 year 7.375%, 1.5pt.
    

    
    Re:.8
    
    Baybank offers to refund application fee if you have (or open) an
    automatic mortgage deduction every month. Fees vary all over (there
    may something I am missing here). I was told atty fees are 575 and plot
    plan is 125. However, a mortgage specialist told me for a refinance
    (which is opposite to what you are implying), atty fees are 650 and
    plot plan is 150.
    
    Thanks for the info.
    -Atul

    .7
    
    I am in a similar position as yours.  I am currently looking
    into 5/25 ballon.  Up to yesterday, the rate on 5/25 is 7.25%
    with 0 point.  Based on my calculation, if I take the 5/25 plan 
    and if I continue to pay same amount every month, the mortgage 
    will be paid-off in 5 years.  There is also a 7/23 ballon, but 
    the rate is less attrative.  Just to give you something to
    think about.
    
    Wendy

              -< More Info? >-
    
    Re:.11
    
    I dont know much about baloon rates or 5/25 program. Can you shed
    some more light? Also can you take my example and work me thru the
    scenario you are describing about paying off in 5 yrs?
    
    Thanks
    Atul

    5/25 program is a 2-step 30 year fixed mortgage.  The current rate
    is good for the first 5 years, then at the beginning of the sixth
    year, the rate is re-calculated, the new rate will be used for
    the remaining 25 years.  This program is good for people have
    very little principle left or people plan to move in 5 years.
    Since the starting rate is usually lower than 15 year fixed.
    
    I currently have a 10.25% 15 year fixed and have a monthly payment
    of $1600.  By switching to 7.25% 5/25 program with a principle of
    $75000, my monthly payment will be about $510.  If I continue to
    pay $1600 per month, I will payoff in 5 years.  
    
    My scenario may not work for you.  Since I have a 3% interest
    drop (10.25 -> 7.25) and you only have a 2% drop.  Just something
    for you to think about.
    
    Wendy
    will be 

            -< Same results with a 10/15 yr >-
    Re:.-1
    
    If you take a 15 yr or a 10 yr mortgage and prepay by that amount,
    you will net the same results. Also rates with 15 yr and a 10 yr
    loan are lower.
    
    Thanks for the answers.
    -Atul

    Re: .8

    I called BayBank for their mortgage rates and also asked them
    about the special deal for Digital Employees.  The person I
    talked to put me on hold and came back and told me that she had
    no knowledge of the deal.  When I pushed backed, she asked where
    I had heard of the special deal.  I was hard pressed to tell her
    about .8 in this notes file.  

    I have heard from a few sources about the special deal outlined
    in .8, so it must be real.  Was this just a short-time special
    or is it still being offered?   Does anyone have any insight of
    who to talk to about it (@ BayBank or DEC personnel/special
    activities)?


    Frank 

 Hi, I applied to refinance on July 3, at BayBanks. I think the person you 
need to talk to is the loan originator for your area. My loan originator knew
about the DEC special. Like you, when I called about the rates, that individual
had no knowledge of a Digital discount.

 What I got was:

	1/2 point off the 2-point mortgage
	1/2 of application fee ($250/2= $125)

 As of today I plan to inquire about the $500 cap on the attorney fee mentioned
 in RE .8.

hope this helps, 

-bob
 

    
    I'll be locking today with Huntington Mortgage at:
    
         15 yrs  7.25%  2pts  APR 7.567
    
              (800-287-4197)
    
                   Bob

    Re .15
    
    I called the central HQ of BayBank.  There was indeed a special for DEC
    employees, but it has expired.
    
    They still offer free checking for DECees, though. 

    It may well have finally expired, but I have been told that previously
    by Baybank mortgage specialists and it has turned out not to be true.
    I currently have a loan commitment from BB under 'the deal', so it was
    in force within the last month. It was also offered to co-workers after 
    I applied for my loan. I'll see if I can check it out at my end.

    re .18
    
    Before you run to BayBank for a check account.....
    
    I worked at Inforex in 1979 when they filed for Bankruptcy protection
    on a Thursday (pay day).  Their payroll checks (as well as their
    severance pay checks) were drawn against BayBank.  All employees who
    had  deposited their payroll checks in their own checking accounts at
    other banks found out that they bounced - BayBank would
    not honor them even though the $$$ backing the checks was on deposit. 
    
    I had to stand in front of a cashier window in their Burlington
    facility and LOUDLY complain about them not honoring a payroll check. 
    One of their Jr. VPs (kind of like DEC, these days) came running out to
    calm me down (and stop the loud complaining) and saw to it that my
    check was cashed.
    
    Not my idea of good customer service (which is ALL a bank provides to the
    consumer).
    
    Dave

    Re .18:

    >
    > I called the central HQ of BayBank.  There was indeed a special for DEC
    > employees, but it has expired.
    >
    > They still offer free checking for DECees, though. 
    >

    I've held a BayBank checking account for 13 years and have never been
    offered it free due to my being a digital employee.  I called this
    morning and was told the checking account deal was good only if you
    were located in Springfield or Westfield.

    Is this true ?  Kinda' sleazy if you ask me...

    L.

    
    
    All this hoopla regarding free checking accounts and mortgage interest
    rate cuts ... Are all false rumors only.
    
    I called BAYBANKS and asked to speak to a high official and he told me 
    that its a FALSE rumor.  If he is mistaking, can the person making the 
    above claims PLEASE give a phone number to call ???
    
    

I opened a FREE BayBank checking account (w/ interest, XPress-Check card and
1st 200 checks free) by calling 1-800-BAY-FAST on Friday morning.  The
person I spoke with had to check when I first asked him, but he said there
was free checking for DEC employees.  I opened the account over the phone,
the confirmation package should arrive this week.  I asked him several times
about different fees, and he said no every time.

If this is a false rumor, am I living in a world of make-believe?

- Jim

    Did they mention that you have to maintain a min. balance of $1500?
    
    On such accounts, they used to give reserve credit (without fees) so
    that in case your account value falls below $1500, the credit kicks in
    and you don't fall below the minimum, there by saving the service
    charges. Now, unless you have an X-press check card, you have to pay
    annual fee for the reserve credit.

    I called the same 800 number last week and opened an account over the
    phone. This was after I went to a local branch and was told there was
    no special deal for DEC employees.
    
    The account will have no minimum balance and will include overdraft
    protection (only pay interest when it is used). The only time there are
    fees are :  when the ATM card is used at a non BAYBANK machine
    	        and a fee for check printing after the first batch. This
                will be about $10 for 200 checks, a little less than DCU
    		charges.
    
    I received the forms in Saturday's mail. To activate the account I have
    to sign them and return them with a check for an opening balance.
    
     

RE:  Note 237.24 by SCHOOL::DESAI
     min balance?

>     Did they mention that you have to maintain a min. balance of $1500?

I asked about this also, they said no.

The info in .25 is confirmation of what I heard.

- Jim

On the subject of bank checks, people might want to call Checks in the Mail,
(800) 733-4443.  They charge just $4.95 for your first batch of 200 checks
and $6.95 for subsequent orders.  Discounts are available for orders of more
than 200 checks.

They have a wide selection of creative designs (not just unicorns and pretty
landscapes), and they imprint your bank's routing code and the check number
just like your bank would.  You can use them for new accounts or for existing
accounts:  just specify starting check number on the form.

We've used Checks in the Mail for over three years now.  They once misprinted
our nine-digit ZIP Code, but one phone call caused a new, corrected batch to be
sent immediately.  Great customer service!


	Nick Bonifanti

    
    
    I called the 800-BAYFAST # and explained this whole rathole and
    the confusion amongst DEC employees.  The person I talked with
    went up several levels and took some time asking around about these
    deals.  Here's what they came up with:
    
    The mortgage deal does exist similar to what is described in here.
    
    FREE CHECKS are offerered to EVERY new checking account that is opened.
    They pay for the first 200, and you buy any thereafter.
    The checking account itself is not free, you have to pay any fees
    involved.  The only execption to this is the Springield and Westfield
    branches.  They have some different options but you will either end
    up with a minimum balance or some sort of fee.
    
    Tim

    And that person's name is ..........?

    
    I recently heard that one bank is offering 7.25% for no points, no
    closing costs (actually you put up $300 or so, but it is returned to
    you at the closing).
    
    Does anyone know of a better rate for no points, no closing costs?
    
    Are there any banks which (also) offer good rates for investment
    property?
    
    /jim
    

    Are you willing to disclose which bank you are referring to?

    The Boston Sunday Globe had 3 or 4 bands offering a 30 yr fixed rate of
    7.125 with no points or closing. I dont remember what banks but I'll 
    bring the paper in tomorrow and put the names in.
    

    oooops typo bands=banks on last message

    Assurance Mortgage in Mass (Westboro & Burlington, I believe) is
    offering a 7.0% no point/no closing cost with a $140,000 loan minimum
    (30 year fixed).
    
    Lots of places are offering 7.125%, it appears.
    
    				

	Forgive my ignorance but what are the "points", referred to in the
	previous replies. Here in the UK mortgages are for a certain %rate
	of interest (usually variable) and for a certain number of years
	(fixed). Those are the main variables. 

	cheers


	Ferdy

    1 point = 1% of the mortgage

and each point you pay reduces the fixed rate of the mortgage.

michael

	A bit clearer but..

	Are points a form of deposit, e.g. you pay 1 percentage point of the
	loan up front, the remaining 99% of the loan is mortgaged. Or are
	points a type of fee payable at the start or end of the term.
	
	Ferdy

it's a fee that reduces the fixed rate....it doesn't come off the mortgaged 
amount.

/mtb

    "Points" are a fee paid to the bank or other mortgage lender - and are
    a relatively new idea; this sort of fee was very unusual when I bought
    my house, which wasn't all that long ago, but is virtually a given now. 
    Or, as others have already pointed out, you can get a mortgage at a
    higher interest rate without paying "points" or at a lower rate if you
    pay the extra fee.  Depending on how the contract is worded, you may or
    may not be able to consider the fee as an interest payment on the loan
    (important for US taxes; mortgage interest is still one of the few
    "loopholes" available to ordinary taxpayers).  And the fee may be
    deductible up front or only over the entire life of the loan.
    
    /Charlotte

	Thanks. Now I understand. I'll "look forward" to points being applied
	to UK mortgages.

	Cheers

	Ferdy

>    The Boston Sunday Globe had 3 or 4 bands offering a 30 yr fixed rate of
>    7.125 with no points or closing. I dont remember what banks but I'll 
>    bring the paper in tomorrow and put the names in.

For the "Boston Globe"-challenged, can someone post these?

Thanks,
Dan

    Assurance Mortgage, 1-617-229-2999 (Burlington office).
    
    On Sunday, 7.00% 30-year fixed, no points, no closing costs,
    $140,000 minimum loan (7.125% on $100,000 minimum).
    
    Long term bonds were up strongly on Tuesday, but I don't know how they
    did yesterday (bonds up = interest rates down)
    
    They have an in-state 800 number but I don't have that handy.

    Talked to a Mortgage company this morning and he said the rates would
    be rising dramatically today because Germany had lowered it's interest
    rates and the bond market was reacting negatively?
    
    The rates yesterday at this mortgage company were:
    
    	30 year fixed no points + ~1200 closing   6.875%
                       1 point  +    "     "      6.750%
                       2 points +    "     "      6.500%
    
        15 year fixed no points + ~1200 closing   6.625%
                       1 point  +    "     "      6.375%
                       2 points +    "     "      6.125%
    
    Closing costs seem like the kicker here. He stated that he would have
    the new rates this afternoon.
    

    	Points are also considered by many including myself as a bribe to
    the bank to lend you the money. :*)

    	One of the main reasons for points is that the bank sells the
    mortgage as soon as you close so they get a few percent from you and a
    few percent from their buyer. That is how they stay in business.

    			Arnie

    
    A minor caveat, the '6 weeks from application to closing' is bunk. 
    We're at 7 weeks now, with at least two more before closing.  This is
    with a squeaky-clean loan, mind you.
    
    I think the problem is just because of the tremendous volume they are
    seeing, nothing more sinister.  They did extend the rate lock without
    question, but rates hadn't changed from when we applied...

    I'm on my 9th week now and looks to be about another 2 weeks or so.
    They are swamped with applications. I'm locked at 7.5% no cost so
    hopefully in 3 weeks they will drop down to 7 so I can go again. :-)

re: last few who have done this...  

So there's no gotchas to these no cost refinances?  I mean, no closing costs, 
no points, etc... Anything you do pay, like application fee and points to 
lock rate are refunded at the closing...?  Call me a skeptic I guess...

I understand you could probably get a better rate if you paid points, but
no closing costs or fees is great!

Dan

like, money in escrow for taxes, insurance premium paid up for the year, if you
don't have 20% there's PMI to contend with (the premium and the escrow), all of
those things are not considered closing cost or points as they are things you
would have had to pay anyway (except the PMI premium which is a real scam).  So
it's not like you can come to the closing with no money in your checking account.

Michael

    There were no gotchas the 4 times that I've done it the last 2 years.
    :-)

i wasn't refering to the list of 'costs' as gotcha's...it's just that some
people don't realize there is money changing hands....(just finished my 4th
refinance in the last year).

/mtb

    
    Even though you pay no closing costs, your still paying fee's. 
    Its just that your paying them with borrowed money and rolling the
    fee's into the loan.  
    We just finished ref-ing at 6.5% but it cost me $4.5k out of my 
    pocket. We could have got no point/closing costs at a higher rate,
    but the payment would have been higher too. 
    
    
                         

    
    The only real expense that the 'no cost' program doesn't cover is PMI,
    for loans that require it (people with less than 80% equity).
    
    Assurance wants $250 up front, plus 1/2 point when you lock the rate,
    but it is all refunded at the closing.  At closing we need to provide
    the initial seed money for the escrow account, which essentially
    matches the escrow money we'll get back from our old loan.
    
    So you do need up front money, but (except for the PMI) is comes out
    even in the end...

    re: .55
    
    That isn't how it works.  None of our closing costs are being
    refinanced into the loan; we are borrowing *exactly* what is needed to
    pay off the existing loan.
    
    Of course the closing costs are coming from somewhere; essentially the
    broker is giving us a higher interest rate than a no point/closing cost
    loan.  The high rate means that they can sell the mortgage for more,
    and they use some of that extra money to pay the closing costs.
    
    So, for use, the choose was between a loan for $X at no cost and 7.25%,
    or $X (same $X) paying closing costs at 7.125%.  Our up front cost is
    less with the no cost, but our monthly payment is more -- but the
    principal amount is the same.
    
    I could image a program whereby one does simply refinance a larger
    amount and roll the costs into the new loan; presumably resulting in a
    larger loan at a lower rate than the type of loan we're getting -- but
    I think that is atypical.

this is also true of Coastal Mortgage....the only exception in my case was I
bargained with them to eat the PMI premium too (we only have 16% equity).

/mtb

    We did this with Concord Coop & were very satisfied.  There were some
    fees that I had to come up with, as I recall:
    
    	termite inspection:	$40
    	smoke detector insp:	$10
    
    Well less than $100 total.  I plan to do this again soon.
    
    L.

Does anyone have historical Fannie Mae Rates?  My situations is this.

I have a one year ARM with DCU that is convertible to a fixed anytime
btw years two and five. I've been in it for 20 payments, so converting
is an option that I've been thinking of exercising.  If I want to convert
today, the interest rate change would become effective on 01 DEC 1993 and 
the rate that they use to calculate the conversion is the Fannie Mae rate 
45 days prior to the conversion plus 5/8 point. This would put me at the
15 October Fannie Mae rate which was 6.57% + 5/8 = 7.2ish% with no cost other
than the phone call.  I'm currently at 6% but adjustable each year.  The 
rate is based on the 30 day T-bill + 2.75%.  Todays t-bill still puts me
at 6% or below.  Seems to be little correlation btw the Fannie Mae and the
T-bill from what I can tell - at least short term.  If I want to convert 
to the 7.2% rate, I need to call them prior to 15 November 1993.  After that
date, they will use the 15 November Fannie Mae that puts me about 1/2 point
higher!

So, I was wondering what the historical Fannie Mae rates look like.  Was
6.57 at or near a low?  It's up to 7.15 as of last Friday - looks like the
trend is up!  Should I look for a lower Fannie Mae. Anyone got the crystal
ball? :*) 

Thanks for any input.

-Brian

    One opinion; a 7.2% long term fixed rate is pretty darn good,
    historically speaking.  I'd take it.

    The October 15th mortgage rates (and interest rates) were the lowest in
    many years, so I would have to assume the FNMA rates were at their low
    back then too.  I'd go for it!
    
      John

It's not entirely inconceivable that someday the large government debt
could cause a run on the US dollar, and if so inflation and interest
rates would skyrocket.  Those with ARMs would then be in a VERY
bad position.  It's not a prediction, but its a risk that should be
considered.  Does your ARM have a cap on how high rates can go?
I'd lock in anyway.  Mid-October rates are going to be hard to beat.

    
    Is there any advantage to refinance with current lender?
    this would be for an investment property. 
    
    thanks in advance
    steve

    Depends--you might get to re-use old inspections or the like.
    Ask the lender.  They know you always have the option of going
    elsewhere, and so may want to keep you by sweetening the deal.
    
    		-John Bishop