Pick A Pay Program
What do investors think of the pick-a-pay mortgage bank programs? The interest only , MTA's and the LIBORS?
What is the financing of choice for investment rentals? If you are the rehabber and are now selling it or wholesaling it. What do people prefer and why?[ Edited by CharlieG123 on Date 06/06/2004 ]
never heard of something call pick-a-pay.
MTA and LIBOR are ARM, w/ the MTA being more stable are it's a moving avg.
I didn't like the MTA for a flip, as I would have 5 payment changes, where as the 6mo LIBOR would as I expect to flip by mo 6.
It all depends on what type of investment property it is.
flips I want to minimize cash flows, rental, or properties being held as rents I want more stability, but would consider a 1yr arm, which I could tie to a rent increase.
Try to match a program to what you expect to be doing with the property. If you want an early exist then a loan that has exit fees is not optimal.
Assume that your plans might not work out and that you might end up holding longer then planned. Maybe only a month extra or maybe you will decide to hold for a year or two longer then your first expected.
If rates float then be prepared to cover the higher costs when they happen.
John
[addsig]
I thought the MTA has a 1 year start rate.
MTA does have a 1 year start rate but the actual interest rate changes monthly.