Saturday, August 16, 2008

Financing Continued

I am relating this saga to my realtor David, and guess what -- he "knows a guy" who can help.

I send him this note Wednesday 8/13 at 10:33pm:

My guy is at 6.875% for a 30 yr fixed, and 7% for a 10/1 IO on rental property. I found someone on Zillow who says she can do a 7/1 IO ARM for 6.5%. My guy doesn't believe it. Do you know what John is at for a 5/1 or (preferably) 5/1 IO?

I get a call from David at about 2:35 on Thursday -- his guy John can get me a 5/1 Interest Only ARM for 6.625%, with an additional half point (about $1500) in closing costs. So, I get out my spreadsheet and calculate that I save $768/year (or $63/month) on interest. I also save about $250/month in cash out of pocket by not paying down the principal. So the cash flow calculation improves significantly with this.

So I call John Thursday afternoon, and tell him I'm interested. Friday morning I get an email from him saying he needs 15 minutes of my time and he'd take care of the rest. I give him a call Friday morning, tell him my income, assets (my house and three others), debt, and rental income.
Friday afternoon at 3:27 I got an email from him -- rate is locked, and he says he can close in 10 days. We'll see if that's really true.

As an aside, I talked to my property manager, and he said it is much easier to rent a house in September than October, so bringing in the closing a few weeks may make everything easier.

So my rate is locked. Next post will be on all the documentation I need to provide...W-2's, Pay stubs, assets, etc etc.

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