anyone going with 5-1 or 7-1ARM loans to buy as interns?

[Igor4sugry]

I'm looking to buy a single family home in columbus for intern year. My residency is 4years.

Huntington Bank is offering loans for incoming residents with 5-1ARM (2.875%) 7-1ARM(3.4%) Fixed30yr (4.?) rates.

How long does it take to process the application?
If I start the paperwork now, will I be able to close by May?

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[plauto]

I've seen many 30 year fixed loans for less than 4%. Shop around. Closing can be done in as little as 45 days if the mortgage people are on the ball, or a lot longer if they are not. Just ask around, real estate agents will know.

 

[ThePursuit]

Yes, there are better loan rates, but NOT with zero down. 5/3 bank was the same for me as Huntington, but 5/3 was more responsive so I'm going with them. Tower mortgage (physicianloans.com?) was a little more but also tacked on a 2% origination fee which is dumb and definitely made me stop considering them. SunTrust and Regions and BBVA compass also offer physician loans I think.

 

[Igor4sugry]

Yes, there are better loan rates, but NOT with zero down. 5/3 bank was the same for me as Huntington, but 5/3 was more responsive so I'm going with them. Tower mortgage (physicianloans.com?) was a little more but also tacked on a 2% origination fee which is dumb and definitely made me stop considering them. SunTrust and Regions and BBVA compass also offer physician loans I think.

Huntington bank offered zero down and a 2.875% rate (as long as withdrawals came from a huntington account) on a 5-1ARM.

 

[ThePursuit]

Like I said, the rates are higher, there's lots of banks offering 5/1 ARMs right now between 2.3 and 2.6%, thus the 2.875% with zero down is a higher rate then could easily be found elsewhere with standard loan products. It was just a pattern I seemed to see, but i'm sure someone on here can prove me wrong.

Regardless, I'm hesitant to use a 5/1 or 7/1 to save a few thousand dollars over residency when mtg rates are historically low. It just makes sense to lock that down. On the other hand, why pay more if I'm not seriously considering keeping the home for longer...

 

[07mcattaker]

anyone using tower? they seem to be taking their time to put together paperwork and loan officer is slow and unresponsive when compared to another place i shopped.
they are offering 0% financing 5/1 ARM for 3.2%, unclear APR, and they are not responding to ?'s re: fees and carryover.

thoughts?

 

[Sol Rosenberg]

anyone using tower? they seem to be taking their time to put together paperwork and loan officer is slow and unresponsive when compared to another place i shopped.
they are offering 0% financing 5/1 ARM for 3.2%, unclear APR, and they are not responding to ?'s re: fees and carryover.

thoughts?

I'm using tower. They are definitely more expensive than other lenders, but they have looser standards for qualification which are, unfortunately (or fortunately?,) useful in my current financial situation and housing market where I will be doing my residency.

They quoted me 3 1/8 for a 5/1 ARM (100% loan with no PMI) with 1 point (1% origination fee) and an additional ~$1400 in lender fees (processing, underwriting, etc.) That doesn't include stuff like appraisal, and all title/state costs etc. The 7/1 ARM was ~0.5% higher, as I recall (which was kind of strange as no other lender that I talked to had that large a spread.) They also don't offer a true 30-year fixed -- just a 30-payoff-in-15. I never asked about carryover.

My loan officer generally gets back to me within a day. The only "problems" have been because they are, afterall, bankers so they are not around on weekends. They committed to getting my loan done within 30-40 days from the contract effective date; we'll see if that works out <crossing fingers>

 

[DrBowtie]

Like I said, the rates are higher, there's lots of banks offering 5/1 ARMs right now between 2.3 and 2.6%, thus the 2.875% with zero down is a higher rate then could easily be found elsewhere with standard loan products. It was just a pattern I seemed to see, but i'm sure someone on here can prove me wrong.

Regardless, I'm hesitant to use a 5/1 or 7/1 to save a few thousand dollars over residency when mtg rates are historically low. It just makes sense to lock that down. On the other hand, why pay more if I'm not seriously considering keeping the home for longer...

Most of those other banks offering lower published rates for 5/1 ARM either require a down payment or it would be difficult to qualify as a single resident with an average medical school debt load. So they are not a reality for a majority of med students.

 

[TexasPhysician]

I used a 5/1. Expect the banking needing 30+ days to close.