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Post by Premier on Aug 26, 2018 2:45:14 GMT -5
I just did a mortgage pre approval and qualified for both an FHA and a conventional loan. The FHA option surprised me since this is not my first house. But it's been years since I sold the last house I owned in KC. I've been renting all this time here in Florida. I was told that after a while you can qualify for an FHA again. Which I liked because of the option for a lower down payment.
The thing is that both the FHA and the conventional are willing to accept as low as 3.5% down with the exact same interest rate and APR for both loans.
I know about the locked PMI for the FHA, and everything points to the conventional being the better option. But the loan person I am working with is pushing the conventional more. Pushing in a way that made me think he stands to gain more from the conventional.
All things being equal and the down payment being the same, any reason to go with the FHA instead of the conventional?
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Post by Deleted on Aug 27, 2018 9:19:16 GMT -5
Are you sure the conventional loan is allowing 3.5% down on a 30 year fixed with no PMI? That is unheard of where I am at, but maybe it's a regional thing.
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Post by locogato11283 on Aug 27, 2018 18:01:38 GMT -5
Just pay cash. Why get a loan?
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Post by Angelo on Aug 27, 2018 19:04:03 GMT -5
Just pay cash. Why get a loan? Because the Trump "boost" is gonna make him need as much cash on hand down the line as possible.
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Post by Deleted on Aug 27, 2018 19:57:39 GMT -5
Just pay cash. Why get a loan? Because the Trump "boost" is gonna make him need as much cash on hand down the line as possible. Based on this post I am all in on the stock market.
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Post by Deleted on Aug 27, 2018 20:00:33 GMT -5
Just pay cash. Why get a loan? Right now you can get a loan for 4.5%, plus you can write off your interest on your taxes which will effective make that about 3.75% depending on his income and filing status. You have been able to get about a 8% return on your money over the last decade in basic market indexes and blue chips. That means you are missing out on about 4% return if you pay cash.
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Post by locogato11283 on Aug 27, 2018 21:28:46 GMT -5
Yea, but how much initial investment to make that the better alternative?
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Post by Deleted on Aug 28, 2018 1:08:28 GMT -5
Yea, but how much initial investment to make that the better alternative? It does not matter, every dollar you put in the market would have netted you 4% over using it for principal reduction on the house over the last few years. If you think the market is going to be flatter than 4% then you could pay cash and reduce your debt. Debt is not a bad thing in many cases if you have good options elsewhere, especially at a young age.
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Post by Premier on Aug 28, 2018 9:19:02 GMT -5
Are you sure the conventional loan is allowing 3.5% down on a 30 year fixed with no PMI? That is unheard of where I am at, but maybe it's a regional thing. Oh do pay the PMI on the conventional. But the way I understand it is that after 20% equity the PMI drops on the conventional, but it stays for the life of the loan with the FHA loan.
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Post by Deleted on Aug 28, 2018 9:43:57 GMT -5
Are you sure the conventional loan is allowing 3.5% down on a 30 year fixed with no PMI? That is unheard of where I am at, but maybe it's a regional thing. Oh do pay the PMI on the conventional. But the way I understand it is that after 20% equity the PMI drops on the conventional, but it stays for the life of the loan with the FHA loan. Got it, didn't realize you were talking PMI on both. If you qualify for both, I would expect that the conventional would be the better option based on the 22% equity rule and the ability to shop rates.
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Post by Premier on Aug 28, 2018 11:50:29 GMT -5
Didn't Angelo worked as a loan officer once?
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Post by Deleted on Aug 28, 2018 14:00:36 GMT -5
Didn't Angelo worked as a loan officer once? I think he was a consultant to Alan Greenspan. Not sure if you can swing it, but if you can knock the terms down to 25, 20, or 15 years... your rate goes way down and your total interest payment is way lower too.
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Post by MMAJim on Aug 28, 2018 15:53:29 GMT -5
Are you sure the conventional loan is allowing 3.5% down on a 30 year fixed with no PMI? That is unheard of where I am at, but maybe it's a regional thing. Oh do pay the PMI on the conventional. But the way I understand it is that after 20% equity the PMI drops on the conventional, but it stays for the life of the loan with the FHA loan. Not saying that FHA is the right call, but in 2012, I believe the FHA PMI commitment was 20% equity and 8 years. So as long as the property value didn't tank, you can get rid of it in 8 years.
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Post by MMAJim on Aug 28, 2018 16:12:37 GMT -5
Oh do pay the PMI on the conventional. But the way I understand it is that after 20% equity the PMI drops on the conventional, but it stays for the life of the loan with the FHA loan. Not saying that FHA is the right call, but in 2012, I believe the FHA PMI commitment was 20% equity and 8 years. So as long as the property value didn't tank, you can get rid of it in 8 years. MMAJim, get your facts straight you idiot. It looks like you're just trying to remember shit that you don't even remember, it only took me 11 minutes online reviewing your loan information to see that you don't know wtf you're talking about. Good day sir!
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Post by Premier on Nov 3, 2018 3:51:08 GMT -5
Closed on a house this past Monday. Finally got moved in today. 10 minutes from the ocean in Delray beach. My first home here in Florida. Wife and I are super happy. Vale was my first visitor. Finished moving at 5pm yesterday and Vale arrived at 1130.
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Post by MMAJim on Nov 3, 2018 19:49:21 GMT -5
Closed on a house this past Monday. Finally got moved in today. 10 minutes from the ocean in Delray beach. My first home here in Florida. Wife and I are super happy. Vale was my first visitor. Finished moving at 5pm yesterday and Vale arrived at 1130. Just in time to not help with the move. Classic Vale manuever.
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Post by Premier on Nov 12, 2018 1:39:03 GMT -5
Closed on a house this past Monday. Finally got moved in today. 10 minutes from the ocean in Delray beach. My first home here in Florida. Wife and I are super happy. Vale was my first visitor. Finished moving at 5pm yesterday and Vale arrived at 1130. Just in time to not help with the move. Classic Vale manuever. Lol. Dude actually helped me patching walls and painting a little bit in the apartment I just moved from. Trying to get as much of my deposit back!
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