No, not a self-photo. Although I did pump some iron this morning to keep the pythons looking healthy. More importantly, I took a look at my wholesale lender rate sheets today, and it turns out, I'm the dumbell.
Funny how you get used to doing things a certain way, and for the past year, I've gone straight to the 30 Year Fixed section of my pricing sheets when running loan scenarios. Why? Because the LIBOR has been so high during that time, ARM loan rates have been the weakling product. And after all the bad press ARM loans got last year, no one wanted that type of loan anyway.
But I should be laid on a weight bench and crushed by a 200 pound barbell for not noticing the change over the past week or so. Looks like the London Interbank Offered Rate (LIBOR) dropped yet another .10 yesterday, lowering the overall rate to 4.10%. Translation, ARM loans are back! Most of the major indices that ARM loans use have fallen in the past few months, and now your 3/1, 5/1, and 7/1 loans are aggressively priced.
How good? For a full-doc borrower, strong credit, and 20% equity, paying 1 pt., I've got a lender with a 5/1 ARM at 4.75%. Wow. Without throwing forty-two disclaimers out there about acceptable appraisals and what not, I'm not trying to be Ditech, I'm just trying to shed some light on a significant shift in the loan product out there. The ARMS are beginning to flex, folks. Question is, are you ready for the "gun show"?
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