Posted on: 09th Apr, 2010 05:05 pm
Need clarification. I am buying a condo and working with a broker who is selling its mortgages to Citi, Bank of America, and Wells Fargo. The broker says were are in the top 1% with our credit scores. approx. 800. I am told I must pay the higher "condo rate" -- why would fannie mae requirements apply? I do not think it worth paying 5% more for now, and am not at all sure $1300 is worth it either to save 1/8 percent. Thanks for info on any current regs about this.
All moprtgage pricing/rates are determined by market rates and to that is added pricing for margins and risk to arrive at the price to the consumer---you.
You have no extra risk pricing due to credit history because your credit scores are so high. Besides people risk, there is also property risk. The secondary market has determined that conominiums and two and three and four family properties are riskier than single family homes.
"Risk" costs money and that is part of the increased pricing.
At the present time a condominium is about .125% higher in rate than single family homes.
I do not understand your comment about paying $1300 to save .125%? I guess you are saying it costs $1300 in points to buy a condo and keep the rate .125% less. Either pay the $1300 or take the higher rate so do not pay $1300 out of pocket or buy a single family house.
You have no extra risk pricing due to credit history because your credit scores are so high. Besides people risk, there is also property risk. The secondary market has determined that conominiums and two and three and four family properties are riskier than single family homes.
"Risk" costs money and that is part of the increased pricing.
At the present time a condominium is about .125% higher in rate than single family homes.
I do not understand your comment about paying $1300 to save .125%? I guess you are saying it costs $1300 in points to buy a condo and keep the rate .125% less. Either pay the $1300 or take the higher rate so do not pay $1300 out of pocket or buy a single family house.