Mortgage Loan Officer Gustan Cho
Mortgage Loan OfficerForum Replies Created
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The initial Utah PLM test was 210 questions. Thereafter, the retakes were 60 questions. I just took the Utah Principal Lending Manager Test for the sixth time today. I thought I aced it after completing the 60 questions test. Then totally out of the blue, I get another 35 questions. Boy that was a nightmare. They were asking me how much the fines are for violations and second-offense violations. I had no clue. I rescheduled the Utah PLM TEST for this coming Thursday. I don’t know why the extra 35 questions was added to the 60 question exam.
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Edna is purchasing a four-unit investment property and is getting an ARM; the loan terms will be 3/6mo ARM with 1/1/5 CAP with a start interest rate of 4.25% and a margin of 2.25%. At the first adjustment, the index is 2.50%. At the second adjustment, the index is 3.25%; at the third, the index is 4.125%. What will the interest rate be 18 months after the initial adjustment?
Start interest rate 4.25% MARGIN 2.25%
FIRST ADJUSTMENT INDEX 2.50%
SECOND ADJUSTMENT INDEX 3.25%
THIRD ADJUSTMENT INDEX 4.125%
WHAT WILL THE INTEREST RATE BE 18 MONTHS AFTER THE INITIAL ADJUSTMENT
THE FIRST ADJUSTMENT INDEX IS A 2.50% MARGIN OF 2.25% INTEREST IS 4.75% TRUE INTEREST RATE AFTER THE FIRST ADJUSTMENT IS 4.75%. THE MAXIMUM INTEREST RATE IN THE FIRST YEAR CAN BE UP TO 5.25%.
THE SECOND-YEAR ADJUSTMENT OF THE INDEX IS 3.25%, AND THE MARGIN IS 2.25%, WHICH TURNS OUT TO BE 5.50%, BUT BECAUSE OF THE CAP BUT BECAUSE OF THE CAP YOU CAN ONLY GO UP TO 4.25% PLUS 1.0% CAP WHICH CAPS IT AT 5.25%.
ON THE THIRD ADJUSTMENT, THE INDEX IS 4.125%, AND THE MARGIN IS 2.25% FOR A TOTAL OF 6.375%. BUT THE MAXIMUM INTEREST CAP OF 1% TO BE ADDED TO 5.25% CAPS THE RATE TO 6.25%.
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Here is a video on how an adjustable rate mortgages work
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Matt has obtained a 30-year 3/1 ARM mortgage loan for $150,000 on a beautiful four-bedroom two bath home in the suburbs. The start rate was 3%. The rate caps are 4/2/8. The margin is 3%. The index was 4% at the start of the loan, 4.25% at the end of year three, and 6.5% at year four. Which of the following rates would reflect the interest rate beginning in year five?
The right answer to this question is 9 percent is the rate at the start of year five. At the end of year three , the rate calculation gives us a 7.25% (3% margin + 4.25 index is 7.25%). but because of the 4 point cap on the first adjustment, the allowable rate was 7% (3% rate + 4 rate cap equals 7%: At year 4, the most it can go up i9s 2% so the maximum would be 9%, even though3% margin + 6.5% index=9.5% rate. Items that do not apply: 30-year $150,000 Beautiful 4 Bedroom, 2 bathroom, 4% Start INDEX. YOU NEED TO KNOW THE START RATE: YOU HAVE TO FIGURE YEAR 4 BEFORE YOU CAN FIGURE YEAR FIVE TO KNOW THE MAX RATE CAN INCREASE EACH YEAR.
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Watch and see. Rates are going to tank and when they do, it’s gonna get slammed hard.
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Found a wholesale non-QM investor that does 120 mortgage late payments.
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Dustin, do you know of any wholesale lenders that will do 120 days of late payments in the past 12 months?
Full doc non-QM wholesale lender.
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One of the places I like to visit. Once I get my motorhome tuned up, I like to travel to South Dakota.
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