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Old 07-09-2012, 04:40 PM   #41
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SWR, if I recall correctly you are uncomfortable with any investment other than CD's, etc. So I would have to assume you'd be investing whatever funds you receive from taking out a mortgage at 1-2%, losing the difference between the interest earned and what you are paying in interest on the mortgage - plus inflation losses. And if interest rates don't increase significantly for the next several years...?

Sounds like a sure fire way to speed up depleting a portfolio to me, but then check my sig line.
Yup, which is why I pay myself 3.5% by not having a mortgage (or any other kind of debt for that matter). But thought I would try to solicit opinions anyway.

If it makes you feel better, I have been looking at Wellesley and mulling. Perhaps throwing a little at it may not be a bad idea. Also I am not limited to US and Canada. Australia is paying ~3.5% + on CD equivalents. The UK is paying ~3.2%. I have access to both markets.

See I do listen.

SWR.
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Old 07-09-2012, 04:50 PM   #42
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See I do listen.
Whatever you decide to do I recommend you do it gradually - and that's what I think I'm seeing from your responses. You won't do yourself any favors by buying into the market then selling once we hit the first bump in the road - and there will be bumps. If you buy Wellesley (or any other fund) and the value dips, look at it like many of us do - as a sale and a buying opportunity.

Also, I know nothing about buying international CD's but I suspect we'd be hearing from a lot of people lauding the merits of that strategy if there weren't tax or other issues associated with owning those accounts.
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Old 07-09-2012, 04:57 PM   #43
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That was one of my thoughts, but if that qualifies me for the loan I'll be really PO'd. Not that I won't take the money, but still, how stoopid can they be?
They ae not stupid. They just don't care. If that loan should ever get into trouble, the guys who sold it to you will have taken the money and run. They just need to fill in the blanks on the Fannie/Freddie paperwork.

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Old 07-09-2012, 05:00 PM   #44
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Whatever you decide to do I recommend you do it gradually - and that's what I think I'm seeing from your responses. You won't do yourself any favors by buying into the market then selling once we hit the first bump in the road - and there will be bumps. If you buy Wellesley (or any other fund) and the value dips, look at it like many of us do - as a sale and a buying opportunity.

Also, I know nothing about buying international CD's but I suspect we'd be hearing from a lot of people lauding the merits of that strategy if there weren't tax or other issues associated with owning those accounts.
I do not want to sabotage this thread but let us say it is sinking in. I am plotting the performance of Wellesley over the next month or 2 before I quit work. I need to also research some other good dividend paying low fee Mutual funds.

SWR
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Old 07-09-2012, 05:01 PM   #45
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If it makes you feel better, I have been looking at Wellesley and mulling. Perhaps throwing a little at it may not be a bad idea.
"Throwing a little" at Wellesley or anything else is on form a bad idea. Having a mental image of throwing money will eventually land you in the ditch.

Ha
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Old 07-09-2012, 05:47 PM   #46
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DW and I built a house last year and have a 30 year traditional at 4.375

I just locked in 3.375 for a 20 year refi with Amerisave. The payment on the refi is about $200/mo more than what I pay now, closing costs will be about $1900.
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Old 07-09-2012, 05:53 PM   #47
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So, does anybody have any knowledge or ideas? Does the Roth conversion kick to my income count as far as mortgage income calculations go? I'd love to be able to take advantage of this. I never considered that having enough money to pay off the mortgage many times over wouldn't count towards my loan eligibility. Also the fact that I currently pay a higher payment without any problem, and a lower payment would only make paying the loan easier. Damn banking industry. Anyway, any help would be appreciated.
Try looking for an asset depletion loan. Basically in an asset depletion loan they look at the assets you have versus your life expectancy to determine the loan amount. It is OK for the assets to be in retirement accounts if you are over a certain age (which I don't recall what that is).
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Old 07-10-2012, 08:42 AM   #48
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Yup, which is why I pay myself 3.5% by not having a mortgage (or any other kind of debt for that matter). But thought I would try to solicit opinions anyway.

If it makes you feel better, I have been looking at Wellesley and mulling. Perhaps throwing a little at it may not be a bad idea. Also I am not limited to US and Canada. Australia is paying ~3.5% + on CD equivalents. The UK is paying ~3.2%. I have access to both markets.

See I do listen.

SWR.
Take the equivalent of the mortgage payments you would be making if you refinanced and carefully place them into Wellesley each month. Best of both worlds imho.
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Old 07-10-2012, 08:56 AM   #49
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Take the equivalent of the mortgage payments you would be making if you refinanced and carefully place them into Wellesley each month. Best of both worlds imho.
Not a bad recommendation. Admiral Shares or Regular?
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Old 07-10-2012, 09:01 AM   #50
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Foreign CDs have currency risk.
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Old 07-10-2012, 06:15 PM   #51
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Where is the money coming from for these 3.5% 30 year loans? Apparently lots of folks with money to lend are thinking that not only there won't be much inflation at all over the next 30 years but that we are sliding right into deflation. I always read that the Fed was very good at controlling short term rates but no so much for long term rates. Is the Fed so powerful now that it can really control long term rates this much?
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Old 07-10-2012, 06:19 PM   #52
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Capwest Mortgage is at 3.375%, 30 year, 0 pts, ~$2k closing costs. I used Capwest on my last refi at a rate of 4.125% about 1.5 years ago.
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Old 07-10-2012, 07:03 PM   #53
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Capwest Mortgage is at 3.375%, 30 year, 0 pts, ~$2k closing costs. I used Capwest on my last refi at a rate of 4.125% about 1.5 years ago.
This is very close to what we locked in today with our credit union.
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Old 07-11-2012, 02:03 PM   #54
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Suppose one has (1) Social Security income, (2) withdrawals from retirement accounts. What does the government want to see from item #2 to get the best rates? The retirement withdrawals for us are completely discretionary.
They want to see a letter from the IRA custodian that you are getting a fixed monthly draw of $XX per month, and that the account is large enough to sustain that draw for at least 3 years. You need to set this up a couple of months before you apply, and they sometimes want to see the draw show up as a deposit into your checking account. You can cancel it after you close on the mortgage.

I've been through this 3 times now.
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Old 07-11-2012, 03:05 PM   #55
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They want to see a letter from the IRA custodian that you are getting a fixed monthly draw of $XX per month, and that the account is large enough to sustain that draw for at least 3 years. You need to set this up a couple of months before you apply, and they sometimes want to see the draw show up as a deposit into your checking account. You can cancel it after you close on the mortgage.

I've been through this 3 times now.
We refinanced in 2010 and they just wanted to see the Fed 1040 showing the net taxable distributions. We have not set up monthly withdrawals and yesterday I locked in a rate.

So I'm hoping that the loan guy I talked to will be OK with (1) a Fed 1040, (2) perhaps some statements showing the withdrawals at irregular intervals for last year. The loan guy seemed to think this was enough and didn't even think we'd need to bother with the Social Security income. But then he is not the compliance department.
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Old 07-11-2012, 03:19 PM   #56
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Yeah, the loan guys you talk to on the phone don't know all the details. Mine was all okay until it went to the underwriter, and she was the one who wanted to see the periodic draw confirmation from my IRA custodian and the checking account statement showing the deposit. At the time, they would not accept anything other than a confirm from the broker. And they especially would not accept our irregular withdrawals--it had to be regular fixed amount monthly withdrawals. Near as I can figure, they want it to look like a paycheck.

Wierdly, the last 2 times we refi'd, they did not want to see our 1040. Of course, Roth withdrawals aren't taxable, so those won't show up as taxable distributions at all. I even offered to send in a copy of the 1040's and they had no interest in seeing them.
Maybe it depends on the underwriter who reviews your file, maybe it depends on what side of bed they got out of.
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Old 07-11-2012, 04:40 PM   #57
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Ray, this makes me wonder if they just ask for the maximum and then if you have an alternate situation they accept something less then their optimal choice. We have an LTV of under 20% and plenty of income to cover our loan. It's almost stupid to have to do an appraisal but those are the rules.

BTW, we have security freezes on our accounts and I had to unfreeze with the 3 credit agencies (for myself + DW, so that is 6 forms to deal with) so they could run their credit checks. The world we live in now.
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Old 07-11-2012, 04:41 PM   #58
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Old 07-12-2012, 08:54 AM   #59
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mortgage

Doing a 3.5% 30-fixed with 0 pts, $0 fees. $1.2K on closing, plus prepaids (small). Using National Bank of Kansas City. Unlike some of the others mentioned in this thread, they write in all 50 US states. Also, their process is completely electronic except for one IRS form that requires a true hand signature.
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Old 07-12-2012, 09:46 AM   #60
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DW and I built a house last year and have a 30 year traditional at 4.375

I just locked in 3.375 for a 20 year refi with Amerisave. The payment on the refi is about $200/mo more than what I pay now, closing costs will be about $1900.
I am just about to close on an Amerisave mortgage. This will be the second refi I have done with them.

I got 3.5% on a 30 year for about $2,200 in closing costs & appraisal, and a $2,350 credit. So into pocket about $150 to me. (There is a bit more of a credit now, I locked about 5 weeks ago)

I recommend Amerisave if you have all your documents, good DTI and LTV ratios. Their appraisal came in a bit low (and the appraiser even said it would).
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