Best Interest Rates
What is the interest rate spread that most of you would chose if you could create a mortgage note with a buyer?
The buyer has a FICO score of about 500, which is in pretty bad shape right now. He wants to purchase the property, and our interest rate is fixed at 5.75% What interest rate would you charge the buyer in order to make your profit?
We usually charge 3%-5% more than the going. ALOT depends on the house and location. We have had houses that we could not make the profit on. Just a rule of thumb.
Sire
If that person were to obtain a loan it would be in the high 8's, so price accordingly.
If you are looking to sell the note on the secondary market, make sure that it is marketable. Just a reminder. GOOD LUCK
The going interest rate for a buyer with 500 middle credit score, fixed is 10.95% at 75% LTV. The going interest rate for a 500 middle credit score for a 2/28 is 8.95% at 75%. But most investors in my area would consider this too much of a risk, and so would I because once you get someone in your home with that credit score with out at least 30% down payment it is very hard to get them out and you start to lose money. The only way for a borrower to get his credit situation improved would be two ways 1) payoff all delinquent credit obligations or 2) fille BK. This would take your person 2 years to be able to apply for a MTG LOAN over 70% lori