Relationship mortgage discounts for moving a million assets

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Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

HSBC does it, but I am not sure to what extent. Might be a good fit if your home country is one of their strongholds.
DH0
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Re: Relationship mortgage discounts for moving a million assets

Post by DH0 »

HEDGEFUNDIE wrote: Wed May 08, 2019 9:51 pm First Republic needs to be on your list. I just refinanced with them at 2.65%.

Yes they use Pershing, but Pershing actually has some positives. For example you get access to DFA funds, no advisory fee required.
Curious how you negotiated this rate with First Republic. I just took a shot...was told the floor was 2.95% for a 7/1 ARM or 3.3% for a 10/1. To get this rate they either needed 15% of the loan value in a checking account (Savings or CDs don't count) or >$1M in wealth management (1.25% annual fee). $900k mortgage on a $2M house. Am I not talking to the right person?
nepats
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Re: Relationship mortgage discounts for moving a million assets

Post by nepats »

10/1 rates have dropped. I was able to get 3.375 without any relationship discount at WF. You can also get 1/8 point for every 250K in assets upto a 1M. So potentially, this could be worth 2.785! This is for a Jumbo loan
HEDGEFUNDIE
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Re: Relationship mortgage discounts for moving a million assets

Post by HEDGEFUNDIE »

DH0 wrote: Fri May 24, 2019 12:01 pm
HEDGEFUNDIE wrote: Wed May 08, 2019 9:51 pm First Republic needs to be on your list. I just refinanced with them at 2.65%.

Yes they use Pershing, but Pershing actually has some positives. For example you get access to DFA funds, no advisory fee required.
Curious how you negotiated this rate with First Republic. I just took a shot...was told the floor was 2.95% for a 7/1 ARM or 3.3% for a 10/1. To get this rate they either needed 15% of the loan value in a checking account (Savings or CDs don't count) or >$1M in wealth management (1.25% annual fee). $900k mortgage on a $2M house. Am I not talking to the right person?
Likely you are not. PM me for a referral.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

I'm working on one of these now. I originally preferred to wait a little longer for a time when it would be more convenient to move assets around, but the recent move in rates means it makes sense to at least start some conversations.

The property is a condo in SF, approx value $1.83M. LTV on my current loan is still very close to 80%.

I got a very similar answer to DH0's from First Republic. I also learned about a 75% LTV requirement on refinances that would be a big downside for me. I'm trying again with a different person at First Republic.

So far Citi has given me the best rate quote, which surprised me. They are offering 2.875% with no points for a 10/1 ARM with $1M AUM. The mortgage banker I talked to hinted that they might be able to cover closing costs. WF is a bit higher at 3.0%, 0.125 points. I've asked if they can match Citi.

I also asked Bank of America if they can match Citi's rate. Normally BofA only counts new money towards the relationship thresholds, but I have a lot of my investments at Merrill Edge, which makes that inconvenient. My ideal situation would be for BofA to agree to match the WF and Citi terms that consider all AUM and not just new money, then I could consolidate at Merrill Edge instead of moving assets to a subpar brokerage (not a fan of WellsTrade, and Citi's platform doesn't sound great either). Also, moving assets out of Merrill Edge would mean walking away for a separate bonus that I will otherwise qualify for in about 2 months.

I don't have much wiggle room in meeting the $1M threshold with investable assets, and a market correction could definitely put me under that before closing a mortgage. The idea occurred to me of buying put options on an index, struck slightly below the current price, with an expiration date around the time I would expect to close. It would be costly, but assuming the options market is reasonably efficient, it should be close to a wash in expected value terms. This is one of the few non-speculative uses I can think of for short-dated out-of-the-money options. Then again, I can't really see myself sinking several thousand dollars into a hedge like this that would most likely expire worthless. Another possibility would be to temporarily lighten up equity exposure while closing the mortgage, but I am hesitant about that as well.
HEDGEFUNDIE
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Re: Relationship mortgage discounts for moving a million assets

Post by HEDGEFUNDIE »

Startled Cat wrote: Sat May 25, 2019 6:07 pm I don't have much wiggle room in meeting the $1M threshold with investable assets, and a market correction could definitely put me under that before closing a mortgage. The idea occurred to me of buying put options on an index, struck slightly below the current price, with an expiration date around the time I would expect to close. It would be costly, but assuming the options market is reasonably efficient, it should be close to a wash in expected value terms. This is one of the few non-speculative uses I can think of for short-dated out-of-the-money options. Then again, I can't really see myself sinking several thousand dollars into a hedge like this that would most likely expire worthless. Another possibility would be to temporarily lighten up equity exposure while closing the mortgage, but I am hesitant about that as well.
Don’t spend too many cycles worrying about this. First Republic at least is very lenient with these thresholds
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mrspock
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Re: Relationship mortgage discounts for moving a million assets

Post by mrspock »

.... or just goto a credit union. Patelco 3.0% 5/1 ARM done. None of this goofy AUM nonsense.

It’s probably not the absolute lowest, but darn close, without the hassles.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

mrspock wrote: Sat May 25, 2019 7:20 pm .... or just goto a credit union. Patelco 3.0% 5/1 ARM done. None of this goofy AUM nonsense.

It’s probably not the absolute lowest, but darn close, without the hassles.
Okay, but the 10/1 ARM is 3.375%, which is exactly Citi's rate without the relationship discount. It's a difference of 0.5% - do you think it's not worth moving some assets around to save about $7300 of interest per year?
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mrspock
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Re: Relationship mortgage discounts for moving a million assets

Post by mrspock »

Startled Cat wrote: Sat May 25, 2019 7:45 pm
mrspock wrote: Sat May 25, 2019 7:20 pm .... or just goto a credit union. Patelco 3.0% 5/1 ARM done. None of this goofy AUM nonsense.

It’s probably not the absolute lowest, but darn close, without the hassles.
Okay, but the 10/1 ARM is 3.375%, which is exactly Citi's rate without the relationship discount. It's a difference of 0.5% - do you think it's not worth moving some assets around to save about $7300 of interest per year?
I don’t need or want a ten year mortgage, the bond market is telling us something if we will listen. Also: are there any strings or fees attached to these AUM arrangements? What’s the fine print (market drops, can they loan out my shares)? For me it’s more like $4500/yr (900k mortgage) or $2250/yr net of taxes. Is Schwab worth that to me? Quite possibly (free amex platinum, free trades, free vanguard MF trades, solid trading platform, excellent customer service, not being foolish in 2008 financial crisis etc).

I also, wonder if Patelco would go lower than their posted rate, so the difference might be even less, I’ve honestly never bothered to haggle with them.
Bobby206
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Re: Relationship mortgage discounts for moving a million assets

Post by Bobby206 »

Great thread. Thanks for all the info. If I ever get a mortgage again I will keep this in mind.
Spencer
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Re: Relationship mortgage discounts for moving a million assets

Post by Spencer »

Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
HEDGEFUNDIE
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Re: Relationship mortgage discounts for moving a million assets

Post by HEDGEFUNDIE »

Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Doesn’t really make sense any more with the new limit of $750k on tax-deductible principal?
Spencer
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Re: Relationship mortgage discounts for moving a million assets

Post by Spencer »

HEDGEFUNDIE wrote: Sat May 25, 2019 8:46 pm
Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Doesn’t really make sense any more with the new limit of $750k on tax-deductible principal?
For a new purchase, I don't think the strategy changes, just a lower limit of $750k instead of $1m. Again, the idea is to simply avoid amortization which erodes the leverage benefits/effects.

I think you may have picked up on something else though. We borrowed $1m 3 yrs ago when it was the max deductible limit, and grandfathered in after TJCA. If we refi at the end of the I/O period, and want to keep it 100% tax deductible, we'd need to pay down principal to $750k. Its a bit of a wash since the current loan amortizes on a 20yr schedule at yr 10, so we'd get down to $750k fairly quickly and who knows what the deductible limit or tax policy will be in 2026. At the end of the day, the rate was the same as the 30yr fixed (30yr amortization), so I went with this product for the optionality.
DH0
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Re: Relationship mortgage discounts for moving a million assets

Post by DH0 »

Spencer wrote: Sat May 25, 2019 9:01 pm If we refi at the end of the I/O period, and want to keep it 100% tax deductible, we'd need to pay down principal to $750k.
I believe the pre-TCJA $1M deduction remains grandfathered after a refinance as long as you don't take cash out.
Spencer
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Re: Relationship mortgage discounts for moving a million assets

Post by Spencer »

DH0 wrote: Sat May 25, 2019 9:11 pm
Spencer wrote: Sat May 25, 2019 9:01 pm If we refi at the end of the I/O period, and want to keep it 100% tax deductible, we'd need to pay down principal to $750k.
I believe the pre-TCJA $1M deduction remains grandfathered after a refinance as long as you don't take cash out.
Thanks for the heads-up. Looks like you're correct. :sharebeer

https://www.kitces.com/blog/tcja-home-m ... ity-heloc/
Specifically, the Tax Cuts and Jobs Act (TCJA) reduces the debt principal limit on acquisition indebtedness from the prior $1M threshold, down to just $750,000 instead. Notably, though, the lower debt limitation only applies to new mortgages taken out after December 15th of 2017; any existing mortgages retain their deductibility of interest on the first $1M of debt principal. In addition, a refinance of such “grandfathered” mortgages will retain their $1M debt limit (but only to the extent of the then-remaining debt balance, and not any additional debt). Houses that were under a binding written contract by December 15th and closed by January 1st of 2018 are also eligible. And the $750k debt limit remains a total debt limit of the taxpayer, which means it is effectively a $750k for the combined acquisition indebtedness of a primary and designated second home.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Sounds really nice except I expect they charge a higher rate for the privilege of deferring amortization. I might ask about this since I am on the same page about preferring to keep the balance up over time.
HEDGEFUNDIE
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Re: Relationship mortgage discounts for moving a million assets

Post by HEDGEFUNDIE »

Startled Cat wrote: Sun May 26, 2019 12:06 am
Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Sounds really nice except I expect they charge a higher rate for the privilege of deferring amortization. I might ask about this since I am on the same page about preferring to keep the balance up over time.
Are you willing to pay off ~500k of mortgage to get your balance down to the deductible limit? Otherwise it doesn’t matter, your balance will be more than high enough.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

HEDGEFUNDIE wrote: Sun May 26, 2019 12:14 am Are you willing to pay off ~500k of mortgage to get your balance down to the deductible limit? Otherwise it doesn’t matter, your balance will be more than high enough.
I own the property with my significant other as tenants in common, and we can each deduct interest on up to $750k. One reason why we are still unmarried is that it's very advantegous from a tax perspective. We joke that we'll get married in 20 years when the mortgage balance reaches $750k.
Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

mrspock wrote: Sat May 25, 2019 8:03 pm
Startled Cat wrote: Sat May 25, 2019 7:45 pm
mrspock wrote: Sat May 25, 2019 7:20 pm .... or just goto a credit union. Patelco 3.0% 5/1 ARM done. None of this goofy AUM nonsense.

It’s probably not the absolute lowest, but darn close, without the hassles.
Okay, but the 10/1 ARM is 3.375%, which is exactly Citi's rate without the relationship discount. It's a difference of 0.5% - do you think it's not worth moving some assets around to save about $7300 of interest per year?
I don’t need or want a ten year mortgage, the bond market is telling us something if we will listen. Also: are there any strings or fees attached to these AUM arrangements? What’s the fine print (market drops, can they loan out my shares)? For me it’s more like $4500/yr (900k mortgage) or $2250/yr net of taxes. Is Schwab worth that to me? Quite possibly (free amex platinum, free trades, free vanguard MF trades, solid trading platform, excellent customer service, not being foolish in 2008 financial crisis etc).

I also, wonder if Patelco would go lower than their posted rate, so the difference might be even less, I’ve honestly never bothered to haggle with them.
How did you get the free platinum Amex? I knew I could get 200 off, but free is huge.
x3t4a7
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Re: Relationship mortgage discounts for moving a million assets

Post by x3t4a7 »

HEDGEFUNDIE wrote: Sun May 26, 2019 12:14 am
Startled Cat wrote: Sun May 26, 2019 12:06 am
Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Sounds really nice except I expect they charge a higher rate for the privilege of deferring amortization. I might ask about this since I am on the same page about preferring to keep the balance up over time.
Are you willing to pay off ~500k of mortgage to get your balance down to the deductible limit? Otherwise it doesn’t matter, your balance will be more than high enough.
Does the 750k deductible limit matter if you are investing the money from the mortgage? I was under the impression you could deduct the mortgage interest in excess of 750k against investment income.
Spencer
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Re: Relationship mortgage discounts for moving a million assets

Post by Spencer »

Startled Cat wrote: Sun May 26, 2019 12:06 am
Spencer wrote: Sat May 25, 2019 8:42 pm Played this game with Wells 3 years ago. Asset discount tiers were significantly higher then, at $1m, 2.5m, and 5m. Moved assets from Fidelity to WellsTrade in-kind, left them there for approx. 1 year, made zero trades, and then transferred back to Fidelity, who gave us a $2500 bonus to move the assets back!

One more positive about Wells is that they offer a 30yr fixed with 10 year interest-only period (then converts to 20 year amortization). For those using the mortgage as a tax/leverage play, this helps keep the balance up, and prevents amortization. Sounds crazy to most, but the play is extremely low cost, tax-deductible, long term debt, so principal pay down is not the strategy. If it makes sense, refi towards the end of the I/O period into the same product, and you can keep the balance up indefinitely.
Sounds really nice except I expect they charge a higher rate for the privilege of deferring amortization. I might ask about this since I am on the same page about preferring to keep the balance up over time.
You would think so, but the I/O rate was the same as the 30yr amortization.
x3t4a7 wrote: Sun May 26, 2019 2:52 am Does the 750k deductible limit matter if you are investing the money from the mortgage? I was under the impression you could deduct the mortgage interest in excess of 750k against investment income.
In the case of a cash-out refi, if you use the proceeds for qualified investments, you can deduct an unlimited amount as investment interest expense. I don't believe you can apply this concept for a purchose money loan. For example, if you wanted to borrow $1.25m and have it deductible up to $750k under the primary residence deduction, and the excess as investment interest deduction, I believe you'd have to purchase the house with a $750k mortgage, and then either refinance into a cash out $1.25m mortgage, or get a 2nd mortgage/HELOC IMO $500k. You'd need to research the debt tracing regs, since things get complicated and specific to individual circumstances.
DH0
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Re: Relationship mortgage discounts for moving a million assets

Post by DH0 »

Spencer wrote: Sun May 26, 2019 10:35 am In the case of a cash-out refi, if you use the proceeds for qualified investments, you can deduct an unlimited amount as investment interest expense. I don't believe you can apply this concept for a purchose money loan. For example, if you wanted to borrow $1.25m and have it deductible up to $750k under the primary residence deduction, and the excess as investment interest deduction, I believe you'd have to purchase the house with a $750k mortgage, and then either refinance into a cash out $1.25m mortgage, or get a 2nd mortgage/HELOC IMO $500k. You'd need to research the debt tracing regs, since things get complicated and specific to individual circumstances.
A great strategy if it's really legal. Have you found it outlined anywhere? I'm tempted to run it by a CPA.

Let's say I pay down my 900k mortgage to 750k, refinance to 1.25M @ 2.75% with a 10/1 ARM and put 500k into a three fund portfolio (keeping good records to trace the transfer). All of the interest is now deductible (750k under MID and 500k as investment interest).

Is this really possible? Seems too good to be true...
DH0
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Re: Relationship mortgage discounts for moving a million assets

Post by DH0 »

May have just answered my own question...seems feasible if done right.

https://www.svb.com/blogs/mary-toomey/m ... st-expense
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

Startled Cat wrote: Sat May 25, 2019 6:07 pm I'm working on one of these now. I originally preferred to wait a little longer for a time when it would be more convenient to move assets around, but the recent move in rates means it makes sense to at least start some conversations.

The property is a condo in SF, approx value $1.83M. LTV on my current loan is still very close to 80%.

I got a very similar answer to DH0's from First Republic. I also learned about a 75% LTV requirement on refinances that would be a big downside for me. I'm trying again with a different person at First Republic.

So far Citi has given me the best rate quote, which surprised me. They are offering 2.875% with no points for a 10/1 ARM with $1M AUM. The mortgage banker I talked to hinted that they might be able to cover closing costs. WF is a bit higher at 3.0%, 0.125 points. I've asked if they can match Citi.

I also asked Bank of America if they can match Citi's rate. Normally BofA only counts new money towards the relationship thresholds, but I have a lot of my investments at Merrill Edge, which makes that inconvenient. My ideal situation would be for BofA to agree to match the WF and Citi terms that consider all AUM and not just new money, then I could consolidate at Merrill Edge instead of moving assets to a subpar brokerage (not a fan of WellsTrade, and Citi's platform doesn't sound great either). Also, moving assets out of Merrill Edge would mean walking away for a separate bonus that I will otherwise qualify for in about 2 months.
So far WF has matched Citi. Both are offering a 0.125% lender credit on the 2.875% rate. Citi may be able to double the lender credit - I will find out in about an hour.

BofA seems intent on matching, even without bringing over as much new money, but it will take a few days to work through the bureaucracy.

I’d like to lock with Wells Fargo or Citi today in case rates go up. Does anyone have thoughts on whether it’s ethical to walk away after locking if BofA comes back with something compelling?
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

Startled Cat wrote: Tue May 28, 2019 4:55 pm So far WF has matched Citi. Both are offering a 0.125% lender credit on the 2.875% rate. Citi may be able to double the lender credit - I will find out in about an hour.

BofA seems intent on matching, even without bringing over as much new money, but it will take a few days to work through the bureaucracy.

I’d like to lock with Wells Fargo or Citi today in case rates go up. Does anyone have thoughts on whether it’s ethical to walk away after locking if BofA comes back with something compelling?
Citi's looking pretty good now. It turns out their quote was based on FICO scores of 740. When they pulled our credit, they saw significantly higher scores, and that made the lender credit go up to negative 0.375 points (more than enough to cover closing costs). I also learned about incentives from the banking side for moving assets I would be moving anyway:
  • $1500 to transfer >$500k in investments.
  • $1000 to deposit $200,000 in a checking or savings account (not sure I would go for this... depends on the hold period, but could potentially be worthwhile as the promotional savings rate is 2.15%).
I locked this rate with Citi today.

WF and BofA still want to be in the running, but I'm not sure they're going to come up with anything better.
Chiron
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Re: Relationship mortgage discounts for moving a million assets

Post by Chiron »

I just closed on a jumbo (~$800k loan amount) and am already hoping I can refinance in the next 6-12 months to the high 2/low 3 rates in this thread. Would save me a boatload over the next 5-10 years. Do any of these relationships count retirement money? I could move IRA money but would have a tough time moving non-plan assets over.
nepats
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Re: Relationship mortgage discounts for moving a million assets

Post by nepats »

Chiron wrote: Wed May 29, 2019 7:12 pm I just closed on a jumbo (~$800k loan amount) and am already hoping I can refinance in the next 6-12 months to the high 2/low 3 rates in this thread. Would save me a boatload over the next 5-10 years. Do any of these relationships count retirement money? I could move IRA money but would have a tough time moving non-plan assets over.
WF counts IRA
Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

Bofa/Merrill also counts IRA.
HEDGEFUNDIE
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Re: Relationship mortgage discounts for moving a million assets

Post by HEDGEFUNDIE »

BoA just offered me 2.5% 5/1 for moving over $0.5M. Could have been 2.25% if I moved over $1M (which I don’t have).
confused1
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Re: Relationship mortgage discounts for moving a million assets

Post by confused1 »

HEDGEFUNDIE wrote: Wed May 29, 2019 11:16 pm BoA just offered me 2.5% 5/1 for moving over $0.5M. Could have been 2.25% if I moved over $1M (which I don’t have).
Assume that’s for a jumbo loan?

I am at 3.125% 7/1 ARM with $250k AUM. Closing costs covered.
Wondering if I can push for more.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

Look at 10/1 as well as 7/1. I saw 10/1 pricing out better in some cases. It doesn’t really make sense to me.
Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

A little birdie told me that Chase has a new relationship program identical to BofA/Wells Fargo but it is unadvertised and not many Chase staff know about it. Ymmv.
Chiron
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Re: Relationship mortgage discounts for moving a million assets

Post by Chiron »

From Chase Private Client web site (https://chaseprivateclient.chase.com/):
5 The Chase Private Client Mortgage Rate Program offers Chase Private Clients rate discounts of 0.125% for total deposits and investments of $250,000 - $999,999 or 0.25% for $1,000,000+.
remomnyc
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Re: Relationship mortgage discounts for moving a million assets

Post by remomnyc »

My WF mortgage banker typically has the most competitive rates with a 0.125% reduction in rate for every $250k up to $1M (0.5% reduction). You can include your contract deposit in the calculation but you have to transfer funds prior to signing the contract and making the deposit. You can move the money out after you close. When I was house hunting in April, the jumbo rates (w/ 0.5% discount) were 3.25% 30-yr, 2.75% 10/1 ARM, 2.5% 7/1 ARM, and 2.875% 15-yr, all no points.

Last year when I rolled my 401k to Merrill Edge, they gave me $2500 bonus and a relationship manager who offered to match any mortgage offer from any bank. When I forwarded WF's offer, I got a match within 20 minutes, and I would not have been required to move any add'l money to Merrill. In the end, I did not buy the home and I'm not sure if I would have chosen WF, with whom I've done mortgages before, or tried BoA.
joyfulnoise
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Re: Relationship mortgage discounts for moving a million assets

Post by joyfulnoise »

Are there any data points if the relationship rates are just for purchases vs. refi vs. cash out refi?

A relationship discount in connection with a cash out refi for a jumbo loan with proceeds split between $750k toward a mortgage refi and the balance toward a brokerage account sounds very interesting.
Startled Cat
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Re: Relationship mortgage discounts for moving a million assets

Post by Startled Cat »

WOW

BofA finally came through after several days with this offer:

2.625% 10/1 ARM, -1/8 point lender credit, conditional on $500k in new money

That’s fantastic and I’m still not sure I actually believe it. But assuming it’s legitimate, it sounds like I’ll be working with them. I’d get to keep the Merrill Edge transfer bonuses I’m eligible for in August, I’d keep my BofA Preferred Rewards platinum status for earning good returns on credit card spend, and Merrill Edge is a pretty decent brokerage compared to the competition.
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8foot7
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Re: Relationship mortgage discounts for moving a million assets

Post by 8foot7 »

Startled Cat wrote: Fri May 31, 2019 5:35 pm WOW

BofA finally came through after several days with this offer:

2.625% 10/1 ARM, -1/8 point lender credit, conditional on $500k in new money

That’s fantastic and I’m still not sure I actually believe it. But assuming it’s legitimate, it sounds like I’ll be working with them. I’d get to keep the Merrill Edge transfer bonuses I’m eligible for in August, I’d keep my BofA Preferred Rewards platinum status for earning good returns on credit card spend, and Merrill Edge is a pretty decent brokerage compared to the competition.
Jesus. Unless I’m missing something that’s a no-brainer
Zombies
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Re: Relationship mortgage discounts for moving a million assets

Post by Zombies »

So how much does that come out to in terms of refinancing costs? My 5/1 ARM with a First Republic is up soon so I’m starting to look into this. When I used the BofA calculator with my numbers it came out to 2.75% for a 5/1 ARM with 0.8 points but I haven’t tried going the “relationship” route yet (and am not sure who to talk to to do that).
desi_kalle
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Re: Relationship mortgage discounts for moving a million assets

Post by desi_kalle »

Startled Cat wrote: Fri May 31, 2019 5:35 pm BofA finally came through after several days with this offer:

2.625% 10/1 ARM, -1/8 point lender credit, conditional on $500k in new money
Impressive rate. Wonder what the 5/1 or 7/1 would have been. Was this a standard offer or did you have to "price match" with another lender?
Agent007
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Re: Relationship mortgage discounts for moving a million assets

Post by Agent007 »

I want to thank this thread. I’ve been sitting on a 4.25% 30 year fixed that I got from a fancy mortgage broker. When we closed the mortgage the broker would send us gifts - wine, chocolate, a $100 pizza gift certificate. Their service was also /very/ attentive which we did appreciate. But reading this thread, I was pretty irritated that people were getting interest rates that were so much lower than the one we got through the fancy mortgage broker.

Talked with BoA and they would do 3.87% on a 30 year. On a 10 year ARM, they would do 3.5%. On top of this, they would drop 0.25% of interest if I moved $500k to them. And they would cover the costs of the new mortgage.

I was a little shocked coming off the phone. We try to save and not spend needlessly. But then we never do the leg work to price shop the thing that costs us the most amount of money every month - our mortgage.
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softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

Chiron wrote: Thu May 30, 2019 5:47 pm From Chase Private Client web site (https://chaseprivateclient.chase.com/):
5 The Chase Private Client Mortgage Rate Program offers Chase Private Clients rate discounts of 0.125% for total deposits and investments of $250,000 - $999,999 or 0.25% for $1,000,000+.
There is apparently a new chart that is identical to Wells Fargo of you know who to talk to. It gives better discounts but is not publicised.
samstar
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Re: Relationship mortgage discounts for moving a million assets

Post by samstar »

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Last edited by samstar on Thu Jul 11, 2019 2:28 am, edited 1 time in total.
Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

At least for me, Chase wasn't competitive even with the new rate. They couldn't touch the others.
spacecadet610
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Re: Relationship mortgage discounts for moving a million assets

Post by spacecadet610 »

Mine was 2.375% 10/1 ARM with 0.6 points after moving in $1million in assets.

Yours is actually a little better accounting for the amount of asset transfer (you'd prob get same rate as me with higher asset transfer) and the lender credit. But mine was locked couple weeks ago and rates have dropped since i locked.

Wonder if Bank of America would be able to adjust to a lender credit but I doubt it since I already locked.
Startled Cat wrote: Fri May 31, 2019 5:35 pm WOW

BofA finally came through after several days with this offer:

2.625% 10/1 ARM, -1/8 point lender credit, conditional on $500k in new money

That’s fantastic and I’m still not sure I actually believe it. But assuming it’s legitimate, it sounds like I’ll be working with them. I’d get to keep the Merrill Edge transfer bonuses I’m eligible for in August, I’d keep my BofA Preferred Rewards platinum status for earning good returns on credit card spend, and Merrill Edge is a pretty decent brokerage compared to the competition.
brajalle
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Re: Relationship mortgage discounts for moving a million assets

Post by brajalle »

US Bank hasn't been mentioned in this thread, but they do have relationship banking perks for private wealth clients - including potentially access to some special credit cards. They might be worth calling, albeit I have no idea how competitive they are for mortgage rates.
samstar
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Re: Relationship mortgage discounts for moving a million assets

Post by samstar »

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Last edited by samstar on Thu Jul 11, 2019 2:28 am, edited 1 time in total.
Topic Author
softwaregeek
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Re: Relationship mortgage discounts for moving a million assets

Post by softwaregeek »

brajalle wrote: Sun Jun 02, 2019 12:29 am US Bank hasn't been mentioned in this thread, but they do have relationship banking perks for private wealth clients - including potentially access to some special credit cards. They might be worth calling, albeit I have no idea how competitive they are for mortgage rates.
I would suspect that there are lots of perks with respect to credit cards, I do know Wells Fargo has a similar balance linked bonus for their credit cards, citi gives thank you points, about 10k points per year as well as $100 annual fee reduction on their top tier card and an account linked bonus. HSBC has a tier with a free fancy card.

Chase gives museum access cards, Schwab has 200 off platinum Amex. Curious what else is out there.
Bofa has a higher tier that I could qualify for but I would lose free trades. It does give more wires, but I only do those once or twice a year.
Last edited by softwaregeek on Wed Jun 05, 2019 8:08 pm, edited 1 time in total.
sc9182
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Re: Relationship mortgage discounts for moving a million assets

Post by sc9182 »

softwaregeek wrote: Sun Jun 02, 2019 2:51 am I would suspect that there are lots of perks with respect to credit cards, I do know Wells Fargo has a similar balance linked bonus for their credit cards, citi gives thank you points, about 10k per year as well as 100 annual fee reduction on their top tier and an account linked bonus. HSBC has a tier with a free fancy card.

Chase gives museum access cards, Schwab has 200 off platinum Amex. Curious what else is out there.
Bofa has a higher tier that I could qualify for but I would lose free trades. It does give more wires, but I only do those once or twice a year.
Have any of us tried getting Interest-Only ARM mortgage for 10/1 or 7/1 ARMs ? What would be BoA requirement for I/O option - is it more down-payment or higher rate or both ? (last time I checked Chase private-client, their Jumbos had .25% higher rate, and minimum 25%-30% down payment required). Hoping for clarity from either BoA or WF considering these low rates ..

Thanks in advance
sc9182
samstar
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Re: Relationship mortgage discounts for moving a million assets

Post by samstar »

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Last edited by samstar on Thu Jul 11, 2019 2:28 am, edited 1 time in total.
grkmec
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Re: Relationship mortgage discounts for moving a million assets

Post by grkmec »

In late March, I locked 1.875% 5yr Interest Only w/ 0.225 points via Bank of America. This was contingent on moving 1mm to Merrill Edge which I have already done. My appraisal came back very bad, so I am likely going take LTV from 75% to 80% and need to pay about 250k in loan balance. I expect to close by the end of the month with a 2% rate (due to higher LTV) and close to zero points.
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