All Encompassing Mortgage and Real Estate Thread

[Neonmoon 38127]

I live in a small tourist town and we still have houses going for 100K over list. These are not 1 million priced houses either 

It’s not just California 

Edited April 8, 2022 by Neonmoon

[Hefeweizen 5306]

22 hours ago, CooterBrown said:

Where can a 10%er afford to buy in Eanes? Is there a trailer park out on the western edge?

Almost.  Overlooking wild basin with a pretty nice lot and very affordable for WLH.  I’m not posting an address but any O&G guys could buy it with the change in their couch.  
 

Seriously though, I’m sitting on my deck wondering how badly I am going to miss it.

[closetohumping 17354]

11 hours ago, We’reTexas said:

Austin is basically there. I mean obviously not if you really number crunch, but subjectively listings like that give me the same “WTF” feeling I get when I see 800 sq ft 2/1s asking $1.5M in SF. Just nonsensical. Edit: and to add, if I had to pick, I’d feel better about buying in SF or many parts of LA right now. 

Yep. I’m a real estate geek.  Austin isn’t there with the absolute nicest parts of California but it’s passed denver and Portland in recent years.  Closing in on. DC.  Easily the most expensive metro in Texas.  Not sure it’s worth it.  I’d rather live in California at that price.  

[UTPhil2006 3785]

Another .04 up today.  Been a brutal week.

[Gil Bang 25843]

1 hour ago, UTPhil2006 said:

Another .04 up today.  Been a brutal week.

Where are we on 30 year conforming now? 

[Neonmoon 38127]

5 minutes ago, Gil Bang said:

Where are we on 30 year conforming now? 

https://www.mortgagenewsdaily.com/mortgage-rates

here are some averages. Obviously Wulaw and UTPhil can get you better ones

 

Edited April 8, 2022 by Neonmoon

[UTPhil2006 3785]

6 minutes ago, Gil Bang said:

Where are we on 30 year conforming now? 

Right at 5.  

[Wulaw Horn 18936]

30 minutes ago, Gil Bang said:

Where are we on 30 year conforming now? 

Here's what my pricing software had this morning as far as national averages for yesterday go:  Standard disclaimer we often do better than average- this isn't an offer to lend blah blah blah.

 

30-YR. CONFORMING

5.061% +0.007

30-YR. JUMBO

4.574% +0.079

30-YR. FHA

4.983% +0.026

30-YR. VA

4.727% -0.058

30-YR. USDA

4.909% -0.011

15-YR. CONFORMING

4.134% +0.088

[Wulaw Horn 18936]

32 minutes ago, Gil Bang said:

Where are we on 30 year conforming now? 

I've locked 4 loans this week:

4.125- VA 30 year

4.375% conventional 30 (this was Monday before everything went to hell- couldn't do that again right now- lowest we would do this very second- without points- would be 4.75 on a really solid 30). 

5.125%  5/1 arm on an investment property

3.5 10/1 arm on a cash out (30 year mortgage)

It looks like Par, according to my loan sifter, for most lenders is right around 5.3%  We shoot for volume so we price accordingly. Some are laying off staff and shooting for margin so they price accordingly.  That's how we get to an average obviously.

I'm all in on arms.  We are seeing spread comparing apples to apples on some of our deals up to 1.5% points on a long term arm.  That's a big number.  We've got a recession coming and we will get out of this at some point in time.  The average American is in their house for 7 years and their mortgage for 4.5 years last I checked on those numbers.  A 10 year Fixed then adjustable will not hurt the average well qualified buyer.  The recession should push rates down as soon as we get out of the inflation cycle we are in. If you are fixed for 10 years that's forever.  

Again- none of this is my professional advice, or a commitment to lend or anything beyond me saying- hey- this is what we did for the last 4 people we locked on 4 different types of programs. You really need to talk to your own mortgage guy. Someone that knows their business. Like me. Or Phil. Or Neon. Or LCHorn. Or the guy at the end of the block that sponsors your T-ball team. Not a knuckle head in Detroit on a headset that will be selling a different widget in a month when they get laid off and doesn't have any craft and isn't going to listen to you and meet you where you are at.  

 

I know you know this Gil- and I responded to you- but this is more for other people who will be reading this thread as a disclaimer. 

[KYHorn 16751]

7 minutes ago, Wulaw Horn said:

I'm all in on arms.  We are seeing spread comparing apples to apples on some of our deals up to 1.5% points on a long term arm.  That's a big number.  We've got a recession coming and we will get out of this at some point in time.  The average American is in their house for 7 years and their mortgage for 4.5 years last I checked on those numbers.  A 10 year Fixed then adjustable will not hurt the average well qualified buyer.  The recession should push rates down as soon as we get out of the inflation cycle we are in. If you are fixed for 10 years that's forever.  

Are there any benefits to a convertible ARM vs just refinancing the standard ARM if the rate goes lower? Not sure I fully understand it all.

[Wulaw Horn 18936]

1 minute ago, KYHorn said:

Are there any benefits to a convertible ARM vs just refinancing the standard ARM if the rate goes lower? Not sure I fully understand it all.

Not that I am aware of. Don't let my ignorance stop you from digging further.  I don't have anyone really selling convertible. My guess is less interest rate savings b/c you'd have a higher rate- but you wouldn't have to mess around with re-paying closing costs if you refinance?  Is that about right?

[Neonmoon 38127]

3 hours ago, Wulaw Horn said:

lowest we would do this very second- without points- would be 4.75 on a really solid 30). 

That’s a fantastic rate for this market right now. Call Wulaw 

[Wulaw Horn 18936]

3 minutes ago, Neonmoon said:

That’s a fantastic rate for this market right now. Call Wulaw 

Only if it's in the next 8 minutes probably the way the mbs market keeps bleeding bips.  Grrrrrrrr. 

[Neonmoon 38127]

That's a shame

more news out of Better.com

https://techcrunch.com/2022/04/07/better-layoffs-vishal-garg-leaked-meeting/

Quote

“Today we acknowledge that we overhired, and hired the wrong people. And in doing that we failed. I failed. I was not disciplined over the past 18 months. We made $250 million last year, and you know what, we probably pissed away $200 million. We probably could have made more money last year and been leaner, meaner and hungrier.”

He also explicitly said that the company lost $100 million in the previous quarter, saying it was his “mistake” for not laying off staff earlier.

“We should’ve done what we did today three months ago … that’s what I’m saying to you right now, it’s what I’ve said to the board before. …You will not be allowed to fail twice. You’ll be encouraged to fail once, but not allowed to fail twice.”

 

[UTPhil2006 3785]

What a train wreck of a company 

[UTPhil2006 3785]

For those scoring at home that’s another .05 up on the 10 year to a new high of 2.76

[Wulaw Horn 18936]

Got pricing to someone Thursday afternoon he got back to me Sunday evening on which way he wanted to go. Slight problem- market 87 basis points between my quote Thursday night and open this morning. Fun stuff! 

[UTPhil2006 3785]

14 minutes ago, Wulaw Horn said:

Got pricing to someone Thursday afternoon he got back to me Sunday evening on which way he wanted to go. Slight problem- market 87 basis points between my quote Thursday night and open this morning. Fun stuff! 

Yep. My AE’s are on speed dial these days 

[Neonmoon 38127]

Yeah, anytime someone asks about current rates, I don't forget to mention the train is going up 

because someone could check in 3 weeks later and the rate is up 100 bps. Like sorry, it's a shitshow, Fed out front should of told ya

[Wulaw Horn 18936]

Just now, Neonmoon said:

Yeah, anytime someone asks about current rates, I don't forget to mention the train is going up 

because someone could check in 3 weeks later and the rate is up 100 bps. Like sorry, it's a shitshow, Fed out front should of told ya

by 3 weeks I feel like you mean 3 hours some days.  

[Neonmoon 38127]

21 minutes ago, Wulaw Horn said:

by 3 weeks I feel like you mean 3 hours some days.  

[UTPhil2006 3785]

36 minutes ago, Wulaw Horn said:

by 3 weeks I feel like you mean 3 hours some days.  

Yep.  Not a fun phone call either.  I'm glad I made sure we locked 2 on Friday.  Woof.

[Wulaw Horn 18936]

8 minutes ago, UTPhil2006 said:

Yep.  Not a fun phone call either.  I'm glad I made sure we locked 2 on Friday.  Woof.

Yeah- they really don't want to give you a pat on the head when they hear their rate is only up 1/8 instead of up 1/4...

[Muny_Tex 290]

As rates continue to climb, are yall seeing (or do you predict) any corresponding tightening of lending standards?

Higher rates (obviously) will impact DTI calculations and corresponding borrowing limits…but I wonder if underwriters (or Fannie/Freddie) may soon have new ideas or restrictions of their own in anticipation of recessionary impact / job market disruptions?

When I bought condo during “peak Covid” of Nov 2020 I recall having my income/employment verified multiple times (right up until closing), but there didn’t seem to be any “marketplace adjustments” for DTI limits at the time.

[Wulaw Horn 18936]

1 minute ago, Muny_Tex said:

As rates continue to climb, are yall seeing (or do you predict) any corresponding tightening of lending standards?

Higher rates (obviously) will impact DTI calculations and corresponding borrowing limits…but I wonder if underwriters (or Fannie/Freddie) may soon have new ideas or restrictions of their own in anticipation of recessionary impact / job market disruptions?

When I bought condo during “peak Covid” of Nov 2020 I recall having my income/employment verified multiple times (right up until closing), but there didn’t seem to be any “marketplace adjustments” for DTI limits at the time.

That's a good question.  I'd say we've definitely seen loosening of standards since Peak Covid, and gradually from 2012 until Covid was a time of loosening standards.  I don't think lending standards get tightened as far as quality of borrower absent a massive foreclosure happening- and that doesn't seem super likely b/c most of your borrowers can sell and cover closing costs rather than get foreclosed.  I mean, if we go into a recession it's possible foreclosures will be up I suppose, but absent pricing collapsing I wouldn't bet that way.

[Neonmoon 38127]

30 minutes ago, Muny_Tex said:

As rates continue to climb, are yall seeing (or do you predict) any corresponding tightening of lending standards?

Higher rates (obviously) will impact DTI calculations and corresponding borrowing limits…but I wonder if underwriters (or Fannie/Freddie) may soon have new ideas or restrictions of their own in anticipation of recessionary impact / job market disruptions?

When I bought condo during “peak Covid” of Nov 2020 I recall having my income/employment verified multiple times (right up until closing), but there didn’t seem to be any “marketplace adjustments” for DTI limits at the time.

The COVID overlays about employment verification and self-employed documentation have already been lifted by Fannie/Freddie

However, because of the Florida condo collapse in June 2021, they have ADDED a bunch more restrictions on getting Condos approved, especially in Florida. 

Fannie increased the backend DTI limit from 45% to 50% in 2017. 

 

 

[Dbeasy 14931]

9 hours ago, UTPhil2006 said:

Yep.  Not a fun phone call either.  I'm glad I made sure we locked 2 on Friday.  Woof.

Thank you sir. Phil and Thad busted their ass all week to get us a customer lock by Friday. Huge for the customer. 

[Neonmoon 38127]

8.5% inflation 

it’s going to be a rocky day 

 

or not. Might have already been priced in 

Edited April 12, 2022 by Neonmoon

[Wulaw Horn 18936]

Posted without comment, other than if you can hear some faint sobbing into a pillow being described as comment...

 

30-YR. CONFORMING

5.223% +0.097

30-YR. JUMBO

4.620% -0.092

30-YR. FHA

5.067% +0.063

30-YR. VA

4.859% +0.070

30-YR. USDA

4.987% +0.074

15-YR. CONFORMING

4.295% +0.139

[Wulaw Horn 18936]

4 hours ago, Neonmoon said:

8.5% inflation 

it’s going to be a rocky day 

 

or not. Might have already been priced in 

Apparently it was priced in. Huge rally right now up 72 basis points.   I swear I don't understand why the fed talk isn't treated the same way. None of it is new news.  Just shrug it off and move on.

I guess the people that parse this stuff decided that the 8.5% inflation number is a good number b/c if you strip out energy the number was "only" 6.5.  Even though we had the highest month over month reading since 82 they think the gas shocks are over- those prices might be on the way to settling down at a lower number- and the rate of growth might finally be stopping.  So, good news in the 8.5% inflation number is the reason for the rally. As it was explained to me/as I deduced from reading around this morning. 

[gmr548 16427]

Yep. I’m a real estate geek.  Austin isn’t there with the absolute nicest parts of California but it’s passed denver and Portland in recent years.  Closing in on. DC.  Easily the most expensive metro in Texas.  Not sure it’s worth it.  I’d rather live in California at that price.  

Absolutely. The value prop for Austin has been obliterated.

[gurt 736]

Looking for some input from the in-the-know crowd here.  My wife and I sold our starter home in Austin last month, made nearly double on it in 5 years.  Hooray.

We sold in order to a) get more space as we are looking to start having kids and b) get closer to my in-laws as my FIL has MD and they need some help with day to day tasks. We have been looking in the Buda area, west of 35.  But even that area is getting insane, with houses finishing 60-75k over asking (ending up at 625 or so).  Part of me is thinking, is this all too much?  Is this really where things are going to stay, or are we heading towards a bubble?  I have considered just renting in the area and seeing how things play out but I also know that interest rates are only going up and I might just be kicking myself if this isn't a bubble situation.  

Thoughts on the situation?

[Wulaw Horn 18936]

4 minutes ago, gurt said:

Looking for some input from the in-the-know crowd here.  My wife and I sold our starter home in Austin last month, made nearly double on it in 5 years.  Hooray.

We sold in order to a) get more space as we are looking to start having kids and b) get closer to my in-laws as my FIL has MD and they need some help with day to day tasks. We have been looking in the Buda area, west of 35.  But even that area is getting insane, with houses finishing 60-75k over asking (ending up at 625 or so).  Part of me is thinking, is this all too much?  Is this really where things are going to stay, or are we heading towards a bubble?  I have considered just renting in the area and seeing how things play out but I also know that interest rates are only going up and I might just be kicking myself if this isn't a bubble situation.  

Thoughts on the situation?

I don't think this is a bubble at all.  We are just massively short inventory and that's not just because there aren't enough homes on the market- that's just because there are not enough homes period.  
Ask yourself this when you think of pricing:

Will there be more or less people moving to the area in the next 6 months, year, 3 years, 5 years.  Then, ask yourself- with the issues with supply chains and everything else going on is it likely that builders will be able to build so many houses that they both keep up with excess demand as well as provide so much supply that they can tamp down the prices?  When you answer those two questions I think, to me anyway, it's obvious what to do.

A lot of this depends on your timeline- how long do you want to be in the house?  If you are going to be there for a while and you see a little decrease in value that's not the end of the world. You don't care about your homes value until you sell. I can't imagine it's going to be down if you look, say, 5 years from now or 10 years from now if that's your time frame.

Finally- look at risk reward.  What happens if you buy your house, it goes down in value a little bit, but you keep your job and continue to make your payments and housing prices recover and then you sell?  A: You make money.

What about the converse? you rent and wait and wait and we see 5-10% appreciation a year (which would be a major slow down from where we were at).  What's the downside then?  You can't buy and are locked out in the area and are a permanent renter.  That's no good, imo, unless you want to be a permanent renter.  You mentioned having kids though so I doubt that's on the agenda.  

[gurt 736]

5 minutes ago, Wulaw Horn said:

I don't think this is a bubble at all.  We are just massively short inventory and that's not just because there aren't enough homes on the market- that's just because there are not enough homes period.  
Ask yourself this when you think of pricing:

Will there be more or less people moving to the area in the next 6 months, year, 3 years, 5 years.  Then, ask yourself- with the issues with supply chains and everything else going on is it likely that builders will be able to build so many houses that they both keep up with excess demand as well as provide so much supply that they can tamp down the prices?  When you answer those two questions I think, to me anyway, it's obvious what to do.

A lot of this depends on your timeline- how long do you want to be in the house?  If you are going to be there for a while and you see a little decrease in value that's not the end of the world. You don't care about your homes value until you sell. I can't imagine it's going to be down if you look, say, 5 years from now or 10 years from now if that's your time frame.

Finally- look at risk reward.  What happens if you buy your house, it goes down in value a little bit, but you keep your job and continue to make your payments and housing prices recover and then you sell?  A: You make money.

What about the converse? you rent and wait and wait and we see 5-10% appreciation a year (which would be a major slow down from where we were at).  What's the downside then?  You can't buy and are locked out in the area and are a permanent renter.  That's no good, imo, unless you want to be a permanent renter.  You mentioned having kids though so I doubt that's on the agenda.  

wow, thanks for the response.  That makes a ton of sense, and definitely clarifies my thinking.

[jimmyjazz 45428]

One year of 15% appreciation pays for a 13% dip.  Austin proper tends not to get hit as hard as neighboring suburbs, which in turn tend not to get hit as hard as the rest of the country in the event of a recession.  That doesn't mean a national slowdown won't hit Austin, though.

With the continuing job growth, supply chain issues, and clamor to be somewhat close to downtown Austin, I just don't see a major correction soon.  Doesn't mean it can't happen.  I am personally loathe to sell one property to buy another, but @gurt is already on that path.  I don't like paying realtors (no offense, realtors) and I don't like losing my homestead exemption and starting over.

I thought I was going to sell this summer.  It's doubtful I will now.  Just one guy's perspective.

[gurt 736]

yeah, I mean ideally I wouldn't have sold but we aren't in any position to pull off buying without the cash from the sale.

But your point is well taken.

[Wulaw Horn 18936]

53 basis points better the market closed today.  That gets us back to almost where we were last Thursday.  Biggest positive move in a day in some time.  We clawed back 1/8!  Still over 5 for national average, but it is what it is.  Best day for the market in a while b/c people were pleased with the 8.5% inflation reading.  What a time to be alive. 

[Hefeweizen 5306]

My short story, with the end yet to be written.

Prepared for about 4 months, with realtor for timing and repairs, etc.

Listed one week ago.  

Four continuous days of tours, probably 30 families total.

3 offers within the first week.

Accepted one fantastic one six days after listing.  

I'm not jinxing anything before closing but I will come back and talk about what buyers are having to  do in this market still.  I feel terrible for anyone who "has" to find a house right now because the market is so frothy.  And this is after interest rates got jacked to levels we haven't seen in years.

I'll let you know in May how the story ends.  

[Neonmoon 38127]

3 hours ago, Hefeweizen said:

interest rates got jacked to levels we haven't seen in years.

[UTPhil2006 3785]

Was down .03 when I got on the plane and down .07 when I got off so that basically means the Astros are gonna win today. Hopefully when I get out of the game it’s down another .05

[TXSooner518 2420]

OK, I fucked around and am now finding out. 

Got into a 7/1 ARM at 3.25% in Feb 2016.  Obv that means the rate goes away 10 months for now.

Didn't refi when times were good, because OBVIOUSLY should be able to do that anytime!  

Recommended strat here? Reading through the thread, part of me is tempted to just wait for the bounce-down, but obv have some fear of cataclysm where it just never stops and is like 9% or worse in Feb 2023 and then it's welp city.  

Current balance is 248k, last year's tax appraisal was 550, this year's is 825 (fucking lol). Current credit is >800. Some cash was taken out with the Feb 2016 loan. 

Edited April 13, 2022 by TXSooner518

[Wulaw Horn 18936]

1 hour ago, TXSooner518 said:

OK, I fucked around and am now finding out. 

Got into a 7/1 ARM at 3.25% in Feb 2016.  Obv that means the rate goes away 10 months for now.

Didn't refi when times were good, because OBVIOUSLY should be able to do that anytime!  

Recommended strat here? Reading through the thread, part of me is tempted to just wait for the bounce-down, but obv have some fear of cataclysm where it just never stops and is like 9% or worse in Feb 2023 and then it's welp city.  

Current balance is 248k, last year's tax appraisal was 550, this year's is 825 (fucking lol). Current credit is >800. Some cash was taken out with the Feb 2016 loan. 

You gamble a lot, right?  So you understand risk reward in cards (and I'm sure life) pretty well. How long do you think you will be in the house?  That's a pretty big part determining what you should do.  

How high can the initial jump go to (it should be capped- my guess would be maybe even as low as 6.25%)?  How high is the lifetime cap?

[closetohumping 17354]

On 4/12/2022 at 10:46 AM, gmr548 said:

Absolutely. The value prop for Austin has been obliterated.

Pretty much.  Coastal cities have more to offer.

[South Austin 51976]

22 hours ago, Hefeweizen said:

I'm not jinxing anything before closing but I will come back and talk about what buyers are having to do in this market still. 

So you got to bang the buyer’s wife?

[TXSooner518 2420]

20 hours ago, Wulaw Horn said:

You gamble a lot, right?  So you understand risk reward in cards (and I'm sure life) pretty well. How long do you think you will be in the house?  That's a pretty big part determining what you should do.  

How high can the initial jump go to (it should be capped- my guess would be maybe even as low as 6.25%)?  How high is the lifetime cap?

Haha yep, gotta maximize EV!  Definitely figure will be in the house for 6 more years (youngest daughter is in 6th grade).  Rate is WSJ 1yr LIBOR +2.25, capped at 8.25, adjusts 85th month then every year thereafter. 

[Wulaw Horn 18936]

8 minutes ago, TXSooner518 said:

Haha yep, gotta maximize EV!  Definitely figure will be in the house for 6 more years (youngest daughter is in 6th grade).  Rate is WSJ 1yr LIBOR +2.25, capped at 8.25, adjusts 85th month then every year thereafter. 

Basically 4.5 if you adjusted right now is my take? Probably a 1 point max every year?

I’d do the cash out 7 year I told you about at 3.5 if there was anything I wanted to do with the cash, or I’d let it ride if you are taking about a 7 year timeframe. 

[Neonmoon 38127]

Do you have any financial judgements against you? No

Title Report - Uh....yeah you do. 

Ahhhhhhhhhh

[closetohumping 17354]

Are we all gettin laid at least?

[UTPhil2006 3785]

On 4/13/2022 at 9:17 AM, UTPhil2006 said:

Was down .03 when I got on the plane and down .07 when I got off so that basically means the Astros are gonna win today. Hopefully when I get out of the game it’s down another .05

Aaaand it’s gone.gif 

[Neonmoon 38127]

Was there a specific reason for the 55 point nut punch today?