Mortgage Blog

Mortgage market update. 

The real estate market is pretty active lately and one of the reasons is very low mortgage rates. Here is some review on what products and rates currently available. 

1. The best rate right now on 5 years fixed mortgage is 1.89%. This is the lowest rate I've seen in 13 years as a mortgage broker. This rate is only available for insured (down payment less than 20%) or insurable purchase and switch. You can't get this rate on rental properties, properties over $1m, or for refinancing, as these are not insurable products. For insurable mortgages this rate is only available with 35% down payment. Not for all clients low rates are good news. For borrowers who are breaking their mortgage before the end of the term, this means higher penalties on fixed rate mortgages. 

2. Another good news is Net Worth program. This program allow clients with moderate income, but high net worth get a mortgage. Any loan amount requested above the qualified loan amount will require $1 in liquid assets for every $1 in mortgage.This program works for purchase and refinancing. Owner occupied, vacation, or rental properties are eligible.

3.Cashback program. Clients can get from 1% to 5% cashback on closing at very competitive rates.

4. B side mortgages. B lenders are for clients with not so good credit or low income reported on tax returns. Borrowers required to have at least 20% down payment. Lender will use deposits shown on business bank statements as an income, not tax return. In fact, clients don't even need to provide NOA. Rates right now also very low from 3.39%, with 1% lender fee.  

5. Private mortgages and Line of Credit. No income verification required. Mortgages based only on equity in the property. Minimum down payment 25% (20% on exception). Rates from 4.9%, plus lender/broker fee. For private mortgages each deal priced individually, based on overall risk and the property. Not always lenders with the lowest rate are the best choice. Need to look at the fee, renewal fee, open or closed mortgage term to determine the best product for each client. Normally private mortgages are for Equity take out from the property, but sometimes also for purchase. This is a short term solution. 

6. Reverse mortgages for homeowners over 55 years old. No income verification required. Rates from 3.49%.

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