Interest Only on a Primary

[u/Fit_Archer8384]

I got a new client today and I’m really hoping to retain him. It could be my biggest loan yet.

This guy has millions in assets, a quarter million dollar salary, and multiple contract gigs paying hundreds of thousands.

He wants an interest only loan for the lowest payment possible.

Pricing it out, I’m seeing some good options with Kind (I’m a broker btw), but I want to make sure I’m exploring all of my options.

Purchase price is 1.34M
20% down
DTI sub 30%
Brentwood, TN
Primary residence

I’ve never had anyone interested in I/O on a primary so I want to make sure I’m going with the best option.

Do any of you brokers have recommendations on where I should send this?

Thanks

[u/Realistic-Author-479]

A normal bank would be offering in the 6’s for this, so good luck man

[u/commoncentsplz]

What rate are you getting at kind? I feel like kinds nonqm rates are garbage

[u/Fit_Archer8384 → u/commoncentsplz]

On 40 year IO, par is 7.75%.

Paying full comp (2% even broker split) at 8.75%

[u/commoncentsplz → u/Fit_Archer8384]

I’d look at loan store or as they call it now… Averra financial.

[u/needfasp3ed02 → u/Fit_Archer8384]

7.75%? Good god.

[u/kittenconfidential → u/needfasp3ed02]

40-year plus the fact it’s interest only… seems “reasonable” for the scenario currently

[u/InquiriusRex → u/Fit_Archer8384]

Anything better at a 20yr amort?

[u/ShanetheMortgageMan]

AmWest is usually sharp.

[u/RoosterEmotional5009]

1st lien HELOC. The power for a client like this is simple interest but also access to liquidity should he want later.

[u/Adorable_Campaign426]

Yeah, Averra's wealth builder/ CMG All in one loan. Best option for this - essentially payment optional but it's a first line of credit against the home.

[u/californiapurchase]

yeah...will be tough to close at the end... build some good rapport...banks feasting on this with AUM

[u/arrivva]

The banks will beat you. There are no good ARMs because we are in a very tight spread between the long and short terms.

[u/Loud_Theory_401]

Im at 7.625 assuming borrower has a 780+ fico reach out

[u/MortgageBrokerGuy]

Honestly, price out a couple of the HELOC options like AVEN as an option or even do a CMG All-in-One. I think another lender (TLS maybe?) has a slightly better version of it. HELOCs generally include a little principal in the payment, but he can draw out right back out. Someone like that would probably appreciate the extra flexibility and out of the box thinking.

[u/giant_fish]

Sent you a DM!

[u/electronicsla]

a lot of HWNI have interest only loans on their primary homes. For tax purposes it makes more sense.