Private Mortgage Opportunity - is this a decent rate?

[Maura Paler]

We are looking at our 4th vacation rental property in the Adirondack Mts (upstate NY).

Our current bank is offering 4.08% with $7,000 closing costs, no guarantee we will be approved, and it takes 2-3 months to close, which can be a deal killer when competing with cash buyers.

We were referred to a Private Money lender, a local husband and wife, who according to our realtor (also our friend) has financed many of her deals. 

Their terms are 2.75 over prime, 20% down, no credit check (although we have great credit) renewable every 5 years, approx $1400 closing costs include filing fee. We pay for the appraisal and the search. Can have the $ in 2-3 weeks after paperwork. 

We have 2 mortgages already and Banks aren't that clear as to what we do (vacation rental) so getting a mortgage is a struggle. 

Thoughts? 

[Shaun Weekes]

Hello Maura,

As long as your loan is presented and structure properly up front the UW should be able to figure out what you're doing quite quickly.

In my opinion 60 - 90 days is unacceptable unless you have a really complicated file or the customer is really slow in getting the Loan Officer what they need.

Find an LO that knows what they're doing and you should be able to get this done in less than 30 days 100% of the time. 

I hope this helps and have a good one.