Hammond Offers Mortgage Rate Under 12% Level
The Hammond Co., Newport Beach, is offering 30-year loans up to $500,000 at a fixed interest rate of 11 7/8%, which it believes makes it the first company to break the “12% barrier†for residential mortgages.
Thomas T. Hammond, president, said the total loan origination costs equate to 6 1/2 points and a 10% down payment is required on loans up to $200,000, 20% down on loans from $200,000 to $500,000. Loans over $114,000 will require 100% private mortgage insurance.
The rates are guaranteed for 60 days from the date of the loan application, Hammond said, adding that that the 6 1/2 points bring the effective rate of the loan to about 12 3/4%.
“People would rather pay a few points up front and have the long-term comfort of knowing that they have locked in an 11 7/8% loan for the life of their mortgage,†he added.
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