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No Early Payment Penalty Mortgage Options

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ckinninger
Established Member

No Early Payment Penalty Mortgage Options

I own two properties outright but they are in Mexico and spend most of my time there.  But, I'm born America and lived in USA 75% of my life.  My FICO score is average 770.  

 

I want to make an investment in real estate near my mother's home in Los Angeles.  I could pay cash for a small home somewhere but I want to use the deal to also get a mortgage on my credit history since I have none.  I'd want to pay it off quickly.

 

My question is what kind of loan could I get that I could pay it off within 1-2 years without early payment penalties.  Since I have a $60,000 salary in USA (rest is Mexican) my total loan amount would be limited by that number.  I would think a 30 year loan would allow me a larger loan amount. 

 

I realize this is an odd situation but any help would be appreciated.

 

 

EX FICO 08: 809 (8/14/13)
EQ FICO: 810 (9/1/13)
TU FICO TU98: 819 (7/19/13)
STARTING EQ FICO: 763 (8/15/11)
Message 1 of 5
4 REPLIES 4
Lel
Moderator Emeritus

Re: No Early Payment Penalty Mortgage Options


@ckinninger wrote:

I own two properties outright but they are in Mexico and spend most of my time there.  But, I'm born America and lived in USA 75% of my life.  My FICO score is average 770.  

 

I want to make an investment in real estate near my mother's home in Los Angeles.  I could pay cash for a small home somewhere but I want to use the deal to also get a mortgage on my credit history since I have none.  I'd want to pay it off quickly.

 

My question is what kind of loan could I get that I could pay it off within 1-2 years without early payment penalties.  Since I have a $60,000 salary in USA (rest is Mexican) my total loan amount would be limited by that number.  I would think a 30 year loan would allow me a larger loan amount. 

 

I realize this is an odd situation but any help would be appreciated.

 

 


For any real estate purchase, there are plenty of mortgage options that don't include prepayment penalties.  I could be wrong about this, but I thought I read a while back that loans with prepayment penalties are disappearing, because some were predatory in nature (locking people into a loan with unfavorable terms).

 

Speak with a loan officer.

Message 2 of 5
boomhower
Valued Contributor

Re: No Early Payment Penalty Mortgage Options

Pretty much any.  Since the housing debacle removed most predatory lenders prepayment penalties are gone.  That said, spending money on closing costs and interest on a mortgage just to improve your already good credit is quite a reach.  Going up from a 770 isn't going to do a lot for you.

Message 3 of 5
ckinninger
Established Member

Re: No Early Payment Penalty Mortgage Options

I would think that without prepayment penalties closing costs much be higher these days.  Any idea what closing costs might be on a $400k home?  Say 150 down.

EX FICO 08: 809 (8/14/13)
EQ FICO: 810 (9/1/13)
TU FICO TU98: 819 (7/19/13)
STARTING EQ FICO: 763 (8/15/11)
Message 4 of 5
boomhower
Valued Contributor

Re: No Early Payment Penalty Mortgage Options


@ckinninger wrote:

I would think that without prepayment penalties closing costs much be higher these days.  Any idea what closing costs might be on a $400k home?  Say 150 down.


No prepayment is pretty much the norm.  3%-4% of the loan is average for closing costs, as larger loan may be a bit more.

Message 5 of 5
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