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Updated almost 3 years ago, 01/28/2022
Rising interest rates
Hello all, I’m working on purchasing my first rental and wanted to know what interest rates others were possibly getting during this time in the market. Don’t really feel mine is being justified at 4.75%. It is my first rental but still seems a bit high in this market.
I have a 782 credit score. The home is in a B+ neighborhood in NJ and appraised higher than our agreed purchase price. I plan to refinance/cash out in 6 months, but never know what the future holds and may not go as planned. Just want to keep my options prime if everything doesn’t unfold accordingly to plan. Or am I just nit-picking??
@Devine Fletcher I'd talk to another lender and see what rates they can offer you. My last two investment properties I bought back in Sept 2021 I got 3.375% rates on, but I know they've gone up since then.
Originally posted by @Dean Klein:
@Devine Fletcher I'd talk to another lender and see what rates they can offer you. My last two investment properties I bought back in Sept 2021 I got 3.375% rates on, but I know they've gone up since then.
Wow! Thanks Dean, yeah I know rates are starting to climb but I haven’t heard anyone quote this much yet. They quoted me less the initial but sent this higher rate after we made an offer smh
Just got a preapproval letter last week from Better.com. My initial rate offered was 5.0%, but if you buy it down in points (seems like play money when they call it that), for the right money-points, I can get it down to 3.875% I think it was. That was getting upwards of $6K to do so.
Originally posted by @Michael King:
Just got a preapproval letter last week from Better.com. My initial rate offered was 5.0%, but if you buy it down in points (seems like play money when they call it that), for the right money-points, I can get it down to 3.875% I think it was. That was getting upwards of $6K to do so.
Okay, yeah i was quoted without any points. even still i feel it is a drastic leap from the original quote of 4.1 they initially gave me.
Originally posted by @Devine Fletcher:
Originally posted by @Michael King:
Just got a preapproval letter last week from Better.com. My initial rate offered was 5.0%, but if you buy it down in points (seems like play money when they call it that), for the right money-points, I can get it down to 3.875% I think it was. That was getting upwards of $6K to do so.
Okay, yeah i was quoted without any points. even still i feel it is a drastic leap from the original quote of 4.1 they initially gave me.
Yes same here. I forgot to mention that when I started shopping, it was over a month ago and the rates were under 4.0, then 2 weeks ago they were 4.0, last week 5.0. Seems the economy is really doing great stuff with this and 40 year high inflation. I could go on but will spare everyone my misery.
@Devine Fletcher That rate seems about right for a (residential) investment property. I am assuming you are asking about an investment loan and not an FHA, conventional, etc.? As @Michael King mentioned, my last residential investment property was 3.875% with I believe 3 points (also $6k). There are a few ways to get those fees waived, but that's a different discussion.
Hope that helps.
Originally posted by @John Walter:
@Devine Fletcher That rate seems about right for a (residential) investment property. I am assuming you are asking about an investment loan and not an FHA, conventional, etc.? As @Michael King mentioned, my last residential investment property was 3.875% with I believe 3 points (also $6k). There are a few ways to get those fees waived, but that's a different discussion.
Hope that helps.
Thank you! 🙏🏽 yeah I’m doing conventional and no points so I guess that why it jumped so much since my initial pre approval.
@Devine Fletcher Wait, so you are doing a conventional or investment property loan? Since you have a 780+ credit score, I would be extremely surprised to see a 4%+ interest rate. If you meant investment loan, then I would say that is competitive.
Originally posted by @John Walter:
@Devine Fletcher Wait, so you are doing a conventional or investment property loan? Since you have a 780+ credit score, I would be extremely surprised to see a 4%+ interest rate. If you meant investment loan, then I would say that is competitive.
conventional loan on investment property. Going by what I see others saying their rates are I was surprised also bc I thought that was pretty high too.
While I cannot post rates on here, I would be interested to know what type of property this is. Single family home as an investment property? Multi unit? If rates are being quoted in the high 4's or into 5's, I would suggest connecting with other lenders to find a better deal. Rates have increased in the last few weeks, but they are not that far out of line from previous months.