7.62 Interest rate and SO MANY POINTS

[Heath Watson]

I recently had a real estate agent bring me a deal on a duplex that is

off market. 2 bed 2 bath brand new hvac, blown in insulation, new

windows, new siding. One side interior not completed other is ready to

go. He does have a lot of materials for the other incomplete side. 100k

they want for it. My lender called me this morning and with 15% down

said it would be a 7.6 interest rate but i would have to pay SO many

points to acquire the loan so closing cost will cost me like 9k. What

would my best option? My credit score was 762 and I'm coming up with

15%. The units are only 1 bed 1 bath, so in the area could only rent

from 550-650 most likely.

[Galen Ikonomov]

That is actually not a bad deal for an investment property.

First, it is really hard to get a property intended for investment with only 15% down nowadays.

Second, the interest rate they quoted you is close to the rate on Primary Residence loan right now. Paying 2-3 points for an investment property is not a surprise. The lenders want mitigate the risk of you defaulting on the investment loan by collecting money upfront.