Mortgage Lenders - Who are you using?

[Movin_on_up]

I'm doing a bit of research to see my mortgage options and am hoping a can get some advice from the forum on what worked and what did not.

My situation:

Purchasing a "2nd home" as an investment/rental property (I rent an apt and will continue to for a while).

Putting 10% down / 760 scores / looking for a 30 year conventional.

Spoke to two local banks in the area I'm buying and got a 3.750 from each.

Has anyone had success with the online banks?  Discover, CapOne, etc?

Just looking to cover all the bases here.

[Vegas247]

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@Movin_on_up wrote:

I'm doing a bit of research to see my mortgage options and am hoping a can get some advice from the forum on what worked and what did not.

My situation:

Purchasing a "2nd home" as an investment/rental property (I rent an apt and will continue to for a while).

Putting 10% down / 760 scores / looking for a 30 year conventional.

Spoke to two local banks in the area I'm buying and got a 3.750 from each.

Has anyone had success with the online banks?  Discover, CapOne, etc?

Just looking to cover all the bases here.

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Are you sure you want to buy an investment home in what I call the "Second Big Real Estate Bubble". Housing prices are almost about what they were when home prices were outrageous......I don't know where you live, but from what I see, the houses are overpriced right now. Unless it's a home you are going to live in, and need a home for let's say a family, I would NOT invest right now. Once the interest rate jump up later this year and early next year, these home that are bought now will be worth a lot less than what you paid. Trust me, I flipped homes in Vegas in 2003, 2004, and 2005 and made out like a bandit. Looking back, I kinda feel bad for the people I sold those homes to and had to foreclose. It's coming people...."The Second Real Estate bubble will hit". I consider myself pretty good at what will happen in the real estate market through selling in the first bubble.

[Lemmus]

...it depends on the market the OP is in ...some have taken off, a lot have not yet but will soon enough ...if he's still in a buyers market then it could be a good investment at current mortgage rates if he knows enough about managing/maintaining a property ...a few months from now could be a very different situation.

...as for the on-line mortgage lenders, I've dealt with Quicken and found them to be OK ...but think you'll be better served by a local mortgage broker or CU ...hth

[frugalQ]

I'm going to play devils advocate: if you purchase an investment property and the "bubble bursts", wouldn't that benefit you as the rental market will pick up?

[Peter1142]

Housing prices aren't even vaguely close to what they were before the bubble burst in my area. If they ever did go back up I would make a fortune. If there were another bubble to burst again here, it would be pretty much the complete and total collapse of the real estate market... which I don't see happening.

While interest rates are low which may inflate home values, banks are extremely tight on valuing homes and the market has not allowed housing prices to inflate. In addition the still ongoing flushes of foreclosures have kept home values low, and the crappy economy with stagnant wages have limited buying power. Interest rates have also been low because of mortgage insurance which is the new way to do business, as well as extremely tight underwriting requirements, it is not all artificial.

I really do not agree with your assesment.

[Movin_on_up]

Thanks for the responses.

I should clarify that this a home in the summer rental market of Cape Cod.  And although prices took a dip last time the homes in this area kept value exceptionally well so I feel that I'm in good shape for the future.

@Lemmus - Thanks for the notes on Quicken and local lenders.  All things (even close) to equal I would like to keep the money local (both local lenders said that they keep the loans at the bank).

Anyone else have suggestions for online lenders?   Wells Fargo, Discover, CapOne?

[Peter1142]

I closed with Capital One. Can't say I would recommend the experience, but I did close and they offered excellent rates with cash for closing incentives.

[Movin_on_up]

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@Peter1142 wrote:

I closed with Capital One. Can't say I would recommend the experience, but I did close and they offered excellent rates with cash for closing incentives.

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Thanks Peter.   Would you mind expounding on this:  "...with cash for closing incentives."

[Peter1142]

They gave me like $3,500 in various credits to apply to closing costs. Not a loan, and not a rate increase, free money. I actually would have had difficulty with the final closing cost tally without it.

[Movin_on_up]

Wow - ok!    Did you end up paying points?