It's been
slow going, but mortgages and home equity loans with automatically
declining rates are starting to make their mark. Here's a sampling
of what companies are offering today.
(Note: A basis point is one one-hundredth of a percent.) |
|
Terms available
|
Where available
|
Average starting interest rate in late
September
|
Conditions for rate drop
|
Miscellaneous
|
Freedom Loan
Associates First Capital Corp., 1-888-977-LEND (5363),
online
application |
|
Up to 30 years, for purchase, refinance or
home equity loan borrowing
|
47 states
|
Wouldn't provide rates; varies with borrower's
credit history, loan-to-value ratio, etc.
|
12 consecutive, on-time payments to get
first 50 basis point reduction. 24 to reduce additional 75
basis points. 36 to reduce another 100 basis points. Total
possible reduction of 2.25 percentage points.
|
Customer rate will drop no lower than The
Wall Street Journal prime rate plus 1 percent (9.25% as
of late September).
|
Back on Track mortgage
The Money Store (division of First Union Corp.), 1-800-LOAN-YES,
Web
site |
|
Up to 30 years (5, 10, 15, etc.), for refinance
or home equity loan borrowing, not home purchase
|
39 states
|
10% to 12%, varies with borrower's credit
history, loan-to-value ratio, etc.
|
12 consecutive, on-time payments to get
first 25 basis point reduction, same for each of next three
12-month periods. Extra 50 basis point cut awarded after four
years. Total possible reduction of 1.5 percentage points.
|
Company won't start reporting customer loan
performance to credit bureaus until November, so borrowers
won't be rebuilding their credit histories in the eyes of
other lenders until then.
|
Automatic Rate
Cut Loan
Service Savers, 1-877-593-6277, Web
site |
|
15, 20 and 30 years. Fixed rate mortgages.
For refinancing or home purchase.
|
48 states
|
8.25% to 8.375% (30-year fixed)
|
Market interest rates must decline by 25
basis points from start rate to refinance. Must be 120 days
since loan closing or last rate reduction.
|
The start rate is generally 3/8 to 1/2 of
a percentage point higher than a conventional loan with the
same term. However, the lender pays all loan closing costs
in most states. "Market Rate" is Fannie Mae 30-year mortgage
yield with 60-day commitment. Can be found in Wall Street
Journal "Money Rates" section.
|
Declining Rate
Loan or Step Down Mortgage
City Line Mortgage Corp, 1-800-813-5119, Web
site |
|
All. Purchase or refinance.
|
15 states
|
7.75%
(30-year fixed rate)
|
Market rates must drop by 50 basis points
from start rate. Customer must provide pay stub to prove employment
and pay for new title insurance policy, approx. $250 to $400,
with each rate drop.
|
"Market rate" is Fannie Mae 30-year mortgage
yield with 30-day commitment. Can be found in Wall Street
Journal "Money Rates" section. Can't be late more than
once on the mortgage payment in the last 12 months to qualify
for rate drop.
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