Rates for 30 yr investment loan

[Korie Apgar]

Hey everyone!  With excellent credit why am I being quoted at 6.5% for an investment property, (non owner occupied, 20% down 30 yr mortgage).  This seems very high to me.  Comparing apples to apples what is everyone else getting these days?   Note that I have a property under contract to sell and the new buyer is getting a rate of 5.375% for non owner occupied with 25% down, 30 yrs.   The differences are 1. the lender and 2. the amount down,  however  5.375 to 6.5 YIKES!!!!!!   Tell me what you guys are currently getting.  Thanks in advance. 

[P.J. Bremner]

@Korie Apgar

There must be some care taken when asking "What rate should I get?" because it's a lot more complicated than the scenario you're laying out.  I have some experience, I was licensed to lend in 4 states and originated loans for about a year.  Here are a couple things that significantly affect the rate you're getting:

- Credit

- Points paid upfront

- Type of property you're buying (Single family, multifamily, primary residence, non-owner occupancy, etc.)

- Type of transaction (purchase, refinance existing loan, cash out, reverse mortgage, etc.)

- Length of term (15, 20, 30 year etc.)

- Loan to value ratio (70%, 75%, 80%, 85% are the big tiers typically)

- Amount of loan taken out (this makes a bit of a difference as well)

Most of what you said it spot on, but I think you can get a better idea of what's out there if you cover all of the bases. The only thing that I can see here that MIGHT affect the rate of loan you're getting is the size of the loan. For example, let's say everything about your lending profile is the exact same - 80% LTV, investment loan, no points, same lender, 30 year fixed, etc. but you were looking at a $400k property compared to a $50k property, you will get a lower rate on the $400k property 99.999% of the time. The company originating the loan has a lot more wiggle room and freedom when the loan size is much bigger.

That being said, I just closed 2 loans last month that were non-owner occupant, 30 year fixed rate, no points, 800+ credit score, both duplexes, cash out refinance, 70% LTV and both loans were $100k - $120k at a 5.5% rate. I had locked the rate the month before, so this is a rate from middle of May. Rates change daily (and sometimes even during the day if there is enough movement in the market) and it's tricky to compare today's rate with those that were locked last month or closed months ago etc.

If you have a Costco membership, you can go through them to find a few lenders in their network that will do the loan for cheap.  I shopped 15+ lenders before I found a good one, but then I checked with Costco while I was in the process and found their lenders to be even cheaper.  I closed my loans with Bank of Internet and they did a heIl of a job.  I hope some of this info helps!