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My loan is at Wachovia. I live in Calif.
EDUCATION
Point your browser to Yahoo (or whatever) and find the Financial Pages. Once
there, look around for the 10-year Bond Price (in yahoo financial, search
for -- ^tnx (shift + 6 makes the ^) -- and you can select to see Today's
pricing, and pricing for 5-days, 3 months, 1 year, 2 years, 5 years, and
Max.
Today the price is up .002%, but today's price is on par with Jan 02, and is
historically low comparing to about 1967 pricing. The change for Today is
relative to Yesterday, or the last trading session. You can see the pricing
fluctuate throughout the day, which isn't very useful to a layman but tells
the professionals to lock or float another day.
There is no direct correlation to Bond Prices and 30-year mortgages, but
generally if bond prices are faling, mortgage rates are falling too, and
rising bond prices lead to rising mortgage rates.
Let's say I was doing a loan for you. I might tell you that I can get you a
30-year fixed for 6.5% (whatever), and you only pay me 1 point (1% of the
loan amount for my commission and desk fees) plus you pay the normal and
customary closing costs. I can get a 6.5 loan for you today and collect a
small rebate from the lender for bringing in the business, but Bond Prices
are rising. I might hurry to get your loan approved and locked (locked being
the important part of this discussion), because I made a representation to
you that given rising bond prices, I may not be able to accomodate tomorrow.
OR, bond prices could be falling, and I can get more rebate from the lender
for bringing in the business if I wait a day. You get what you agreed to, I
get more that I imagined. All is good. Or, you get what you agreed to and I
get less than I hoped for. All is still good, just not as good.
YOU did not give us enough to get our arms around why you are being offered
an 8% loan (rounded). But, a rate like that will pay the sales commission
and all of the normal and customary closing costs. Your offered rate is very
high, considering the market conditions AND assuming you have a good FICO
score and Loan To Value. If your FICO sucks, and/or your loan amount is high
relative to the property value, then MAYBE this can explain the rate, but
you are paying a Loan Shark rate if you take this loan.
It's entirely possible that all you can get is a loan shark rate, in which
case you prayerfully consider your options, then move from there. I think
you also suggested your loan shark rate has a prepay, this tells me that
perhaps you have some financial baggage because a rate like this ought not
have a prepay unless the risk was very high.
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Re: Opinion
