| Author |
Message |
    
pmart
Citizen
Username: Pmart
Post Number: 169
Registered: 7-2001
| | Posted on Monday, May 22, 2006 - 12:52 pm: | 
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(I put this in the Finance section but thought it might be a little more visible here...apologies for the repeat)
I'm looking for a fixed rate loan to pay off my HELOC. I spoke with loan officers from both Valley National and BOA.
Valley: 6.00%/10 yrs (-.25%/auto deduction from checking account)= 5.75%
BOA: 8.54%/25 yrs (-.5%/existing customer; -.5% auto deduction; -.5% if I borrow $5K more) = 7.04%
Both lenders carry no closing costs/fees and OK to pay down amount prior to term (Valley: cannot pay off before 15 months or else they charge $400). Not sure if Valley rate is APR (but seems so based on their website)
Why such a huge difference? What am I missing?
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greenetree
Supporter
Username: Greenetree
Post Number: 7769
Registered: 5-2001
| | Posted on Monday, May 22, 2006 - 1:03 pm: |
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I can't explain why, but shorter term loans always seem to have lower interest. Maybe because the interest is primarily paid in the first few years of the loan they want to attract customers who would otherwise not be able to afford the shorter option?
I'm curious to see how this gets answered myself. |
cppkqp
Citizen
Username: Cppkqp
Post Number: 128
Registered: 8-2002
| | Posted on Monday, May 22, 2006 - 6:15 pm: |
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Don't know why there is such a big difference, but I can tell you that we've found Hudson City has had the lowest rates we've found. It's worth checking out. We moved our mortgage to them, refinanced it (allmost too easy!), took out a HELOC (which we never used), later cancelled that and took out a HE Loan, all with Hudson City. Prompt service, friendly people, and easy to work with, in addition to great rates. From what I understand they don't sell their loans to other banks.
They also don't spend a lot of $$ on fancy offices. A visit to their Millburn office (on Main St. across from Ling Ling) makes you feel as if you've stepped into the 1950's. |
Mergele
Citizen
Username: Mergele
Post Number: 393
Registered: 7-2003
| | Posted on Monday, May 22, 2006 - 6:58 pm: |
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That Valley rate is comparable to some of the promotional (intro-only) rates that I've seen out there. Those are usually for the first couple of months only... Check out bankrate.com for local rates, and I'd certainly try direct lenders before going with a retail bank. |
eliz
Supporter
Username: Eliz
Post Number: 1473
Registered: 5-2001
| | Posted on Monday, May 22, 2006 - 8:29 pm: |
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I just went through this and pl'd you. |
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