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September 14, 2009
Conforming or Jumbo?
My wife and I have signed contracts on buying a 2 br brownstone apt. Very happy etc. We were set to move ahead with a jumbo-conforming mortgage with a 5.75% rate w/ half a point. Well, this has been dragging for a few weeks and since then a few extra $ have been deposited into our account (getting paid!) and we are very, very close (within 10k) of being able to put down enough to qualify for a conforming loan ($417,000).
Currently, the mortgage with 20% down is $462,000, however, what I'm not sure about is whether he should really try to get that down to $417,000 and get the MUCH better rate, or just refinance at a later date?
First time buyers so any advice would be much appreciated :)
Thanks!
P.S We do not qualify for the 8k 'incentive'.
Comments
jumbo...not jumob...lovely start to the day.
Posted by: kissiffer4 at September 14, 2009 12:06 PM
refinancings cost money, time, and energy. Why not get it right the first time?
Posted by: Putnamdenizen at September 14, 2009 1:15 PM
Agree with Putnamdenizen, do the best that you can now. As someone who is heading into month 6 of a refinance process WITH MY CURRENT MORTGAGE HOLDER, I can tell you that refinancing today is very very laborious and drawn-out. Avoid having to refinance later if you possibly can.
Posted by: Brownstonerlogin at September 14, 2009 3:24 PM
The conforming jumbo rate also seems high. Check around....
Posted by: slick at September 14, 2009 3:37 PM
No question . . . get to $417K
Posted by: Bklyn365 at September 14, 2009 3:48 PM
Get it right the first time I say. Go with the conforming. As others have said refinancing cost money ..time.. etc. plus you never know what the future holds.. you may lose your job etc and might not be able to refinance or rates at the time u try to refi might not be as good.
Posted by: scarter at September 14, 2009 4:06 PM
Your mortgage rate is lower than those I've looked at. May I ask you from whom you're getting your mortgage?
Posted by: Pigeon at September 14, 2009 5:18 PM
Beg, borrow, steal. If that doesn't work, ask about a HELOC to bring the amount down to 417. Works in some situations. Like mine ;-)
Good luck on your purchase!
Posted by: Johnny at September 14, 2009 6:28 PM
Yup- definitely get it down to the $417,000 right off the bat. When you re-finance it isn't always the cheapest thing regardless of the rate. THe first 5-7 years you are paying a higher amount towards interest rather than principal so it's like starting over and it may st you more in the long run.
Posted by: argentina at September 14, 2009 10:36 PM
To Pigeon regarding rates:
Have you checked out HSBC? THeir conforming is at 5% and if you do their Communityworks 30 year conforming you can get a rate of 4.625%. There are restrictions with this product (no cashing out for refinance and no HELOC allowed) butit's allowed me to enjoy a great rate.
Posted by: argentina at September 14, 2009 10:44 PM
We'll second the HSBC suggestion. We were able to lock in at 4.375% in the Community Works program.
Posted by: housebywe at September 15, 2009 12:28 AM
Thanks so much for your input :) I'll certainly look into the HSBC Community Works program. Would either of you mind emailing me to let me know how you went about getting that rate? cfrankland@gmail.com
Do you know if there is any sort of mortgage cap or income cap related to the plan?
Thanks!
Posted by: kissiffer4 at September 15, 2009 8:56 AM
HSBC communityworks
*Borrowers income must be at or below 80% of the median area income or the property must be located in a designated census tract
Posted by: Adam Dahill at September 15, 2009 9:08 AM
Thank you all for the HSBC community works info.
Posted by: Pigeon at September 15, 2009 11:45 AM
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