What refinance rates are you currently seeing since the New Year?

Question

Just curious to what Occ Owner Occupied refinance rates everyone has been getting since the new year. Haven't seen a thread like this in a bit.

Please indicate if it is a cash out refinance! Also indicate if you bought any points! Mention your credit score range too!

If you want to mention your non-owner occupied rates to help other people reading please do so just make sure you mention it!

I'm personally looking for residential owner occupied cash out refi rates. Considering refinancing soon seeing how interest rates are around 3.5% I think? But I know that differs from what you will actually get from a bank.

*Not looking for a lender just looking for people who have recently closed/will close soon and have received an estimate!*

Chris Mason · Answer

The basic cash out adjustment is 0.625 points, which typically translates into 0.125% to 0.25% to rate if you'd rather eat it in your rate than eat it in how much you're pulling out. But what plays out is the cash out puts you in a new LTV bracket, they go in 5% increments. Someone that owns a property free/clear going to 40% LTV will get a much better deal than the person asking "hey Chris, so what's the max?" -- and people DO sometimes stop at 40% or 50% LTV, don't let the "zomg dead equity!!!" narrative fool you about that.

Aside from people with bruised credit, the most "adjusted" scenario I typically see (especially at, say, Oakland or San Jose price points) has all of the following hits:

- Investment property.

- "Conforming high balance," not conforming. This is a biggie most of the US doesn't have to worry about. Bay Area / LA / SD / NYC / etc issue.

- 70% LTV

- 2-4 unit (2-4 unit FNMA/FHLMC type loans that are cash out stop at 70%)

- 70% LTV cash out investment (yup that's it's own hit).

- Cash out.

- Some lenders and banks have a ">4 financed properties" hit, but might have the better 'starting' rate, so I have to figure out where the best deal is to be found after netting it all out.

It all ads up to 4 points or a rate bump to absorb, your choice witch.

Some lenders tap out, at zero points it's above the highest rate they offer. Everyone that calls me or meets with me for that scenario hates their rate/fee combo. But the hits are the same everywhere, and we're better than most to start with before the hits, so we do a fair amount of it. Hate and all.

Great credit is the new college degree. Perhaps back in 1965 a college degree impressed potential employers, but now it's just a standard thing that everyone has.

Fred Thomas · Answer

@Chris Mason Always great info from you. I am a lurker and always notice the value of your posts. Wish you loaned outside of cali!

Chris Mason · Answer

Rates are overall ridiculously good right now, if you live there and the rate starts with 4, or has PMI, or it's a rental and it starts with 5, and your credit isn't horrible, you need to refinance. "High 3s" (owner occ) or "Mid/high 4s" (rental), look into it if you've got time, but the world isn't going to end if you miss out, your rate is already pretty good.

Some of the rate leaders have reached capacity, and are starting to bump their rates to compensate for paying out overtime due to all the refinance activity. Solution there for the time being is to simply not broker loans to those particular banks, but at some point (no one can predict when) capacity will be reached industry wide and the game of musical chairs will be over. Usually at times like this, it's the fence sitters that end up missing out, trigger pullers are the ones who score.

Historically how rate movement often goes is that they drop over the course of weeks, and then overnight something happens (a Tweet from the president, a job report, etc) and they very very quickly hike back up. By the time journalists are taking note, it's too late, the movement already happened... journalists typically use the Freddie Mac rate index, which is a week out of date as a standard feature, for example right now it's 2/4 and they last updated 1/30 using data drawn from the week immediately prior.

Fred Thomas · Answer

Anyone else refinance since the new year ?!

Fred Thomas · Answer

@Chris Mason So when I see the news saying rates are at 3.5% am I typically going to be able to find that at a bank with no points with great credit? I guess I am asking how much more should I expect to get it at anytime I look at interest rates. If its 3.5% do I typically add .25% or what is standard? + how much do you add extra for cash out

Timothy Hero · Answer

I'm not an expert in the conventional game, so I won't speak much on it. The private side is my main focus.

John Morgan · Answer

@Fred Thomas

Just closed on a cash out refi last Thursday and my rate was 3.875% on a 15 year note with one point. Did another cash out refi in November with my credit union for the same rate. Not great, not bad from what I’m hearing others are getting. My credit score is 730.

Fred Thomas · Answer

@Timothy Hero How does house hacking effect conventional occ interest rates?

What are the requirement differences for PML?

Timothy Hero · Answer

Depends. Seasoned investors are not going the conventional route for obvious reason. But those that are, at lease from those I've talked to, have been getting between 4% - 4.5%.

It depends what you're seeking and your situation. You can go conventional and get 1% lower and it effect your credit, or you can go with a PML and pay 5.5% and the loan not show on your credit. An extra 1% on a $120k loan is $120/month difference. If you're doing a bigger loan, say $150k+, then it starts to add up.

But for conventional, 4 - 4.5%. Sometimes I hear about properties in the 3's, but that's only after house hacking.

What refinance rates are you currently seeing since the New Year?

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