Skip to main content

There is a current interest rate secret that lenders don't want you to know about...

Over the past 6 months, the largest group(s) making an impact to market share for mortgage lending are Credit Unions and Local Banks/Mutuals.

We can get into the logistics a bit, but the bottom line is that in almost every State or local market there is a credit union/small bank/mutual that is offering a rate significantly below the rates you are finding when working with the "big name" local lenders or your Agent's preferred lender. They are able to do this because they are putting the loan on their portfolio and either

1 - understand that they are lending at a very low rate but their typical volume is not large enough to need to make a change or 2 - the individuals who set rates are asleep at the wheel (because their mortgage loan volume is not impactful to their bottom line)

We lend nationwide and started to run into Credit Unions and Small Savings banks offering rates/terms that you would consider ridiculous around June of this year. It then escalated to over 30% of our overall rate losses (from 5%).

Right now we are seeing 4% on 5/1 ARMs, 4.25% on 7/1 ARMs, 4.875% on 30 year fixed rates. The lenders are completely different in every local market from Chocolate Bayou Savings in Houston to the California Teachers Credit Union in CA.

The bottom line is - if you are looking for a mortgage rate right now, you need to look for every local bank and credit union and see what they have to offer before making a commitment. If you are about to take a 30 fixed in the 6+% range, you should know that you are missing an opportunity to save hundreds of dollars every month in interest.

Some larger lenders with high performing Originators are trying to work with these small banks and credit unions to allow their Originators to offer these products in hopes that the small bank or credit union will buy those loans immediately. However, these banks/credit unions do not want "that much" volume at these low interest rates.

This has not been the case historically. Larger Lenders were able to offer competitive rates and uncompetitive rates might only be .125 or .25% higher than other lenders. However, we are now seeing portfolio rates at 1-2% lower than large/national lenders.

submitted by /u/laceyourbootsup
[link] [comments]

source https://www.reddit.com/r/RealEstate/comments/z80whn/there_is_a_current_interest_rate_secret_that/

Comments

Popular posts from this blog

Aren't comps/CMAs useless with buyer credits at close happening now?

I'm looking into buying a new construction townhouse in my HCOL US city. I'm seeing builders offering interest rate buydowns worth $20k-$60k on $800k homes (rather than just lowering prices) in order to keep their comps high for their other units, now that buyer demand has been declining. I asked my agent about these, and he said these buydowns aren't even the full story: buyers can write all kinds of other credits into an offer, like their closing costs, prepaid sewer fees, etc. Apparently cash buyers can just write in a "buyer credit at close" for any amount in their offer. So a new townhouse that appeared to sell for $800k in the MLS might have actually been a cash offer with a $100k+ buyer credit at close, meaning the buyer only spent $700k or less in total, but to the rest of the world they can only see the $800k! So that made me realize I can't trust comps/CMAs for other new construction townhouses. The sales prices could be way lower than they appear...

How to Avoid Property Scams in Delhi?

Here’s What You Should Know! Commercial Real Estate (Non-Residential) Buying a property in Delhi can be tricky, especially with all the stories about scams and shady deals. If you're in the market, here are some tips to keep yourself safe:Double-check the documents: Always verify ownership and approvals. Don’t just take someone’s word for it—look at the actual papers. Do your homework on prices: Compare similar properties to avoid overpaying. A little research can save you from a bad deal. Work with trustworthy people: Whether it's a seller or an agent, go for someone who's transparent about pricing and the process. If they’re dodging questions, that’s a red flag. Ask for reviews or references: If someone you’re dealing with has a good track record, they won’t hesitate to share testimonials or connect you with previous clients. I’ve noticed that some property services have started focusing on things like verified listings and clear communication, which makes the whole proc...