CEMA on a resale purchase
Started by S50412
almost 10 years ago
Posts: 6
Member since: Mar 2012
Discussion about
Has anyone done a purchase CEMA on a condo resale? From what I've heard, it seems most CEMAs done are for refi's and once in a while for new construction, but rarely are used in resales. Given how much prices have appreciated in the last few years, anyone who is selling a property they bought in the last 5y probably still has a good chunk of principal left on their loan. Shouldn't buyers more aggressively be trying to assign the balance? Does anyone know which lenders are willing to facilitate a purchase CEMA?
Fees and time may eat up any savings, particularly if the lenders are separate institutions (this is why they're mostly done for refis. I don't know if it also affects the ability of the second lender to later securitize or otherwise assign the loan (so they will be reluctant to limit their later options).
Do you know which banks may facilitate this, if any? From what I've learned so far, Citi yes possibly; WF and HSBC no (at least based on the individuals I've spoken to).
It seems to me that additional fees would need to be several multiples of the standard R/E attorney fee in order to destroy the economics. For ex, a 1mm mortgage transfer yields a 19k savings. Typical R/E attorney fee in the 2-3k range, so would the CEMA cost multiples of that?
As far as extra time required, that's also something I'd like to hear about, if anyone has gone through the process. Whether or not it's a deal-breaker depends on how much time it actually is, and if either party is in a rush.