Posted by John Corey on November 13, 2005 at 22:06:10:
Another meaning…
In My Humble Opinion - IMHO.
Mostly used when people are stating opinions or their personal views. They want to quickly indicate that it is an opinion and not something that is based on a specific fact. Hence it should be treated as humble/honest ‘opinion’
John Corey
Chelsea Private Equity, LLC
advice on fixing a rate for 2008-2010 - Posted by Paula K.
Posted by Paula K. on November 07, 2005 at 08:23:20:
I have the opportunity to add on to a current fixed rate term on a note for 6 commercial properties that my business operates out of. The current rate expires in 2008. I can add on 2008-2010 fixed at 7% - I am leaning towards the conservative side and doing this. Any advice? Thank you.
Re: advice on fixing a rate for 2008-2010 - Posted by Patrick S. Lawson
Posted by Patrick S. Lawson on November 07, 2005 at 09:32:12:
Are there any costs associated with this change?
If the answer is no, then it sounds like a good deal. What is your current rate?
Re: advice on fixing a rate for 2008-2010 - Posted by Paula K.
Posted by Paula K. on November 07, 2005 at 10:15:39:
current rate is incredible - 4.99 thru 2006, 5.25 thru 2007, and 5.75 thru 2008… $500 paperwork fee - what is actually happening is that my father is transfering this real estate to me (avoid taxes) and I simply asked the bank if there was anything they could do for us… so the deal is leave like is and re-negotiate in 2008 or take the additional fixed rate at 7% thru 2010 - it is a gamble either way I guess.
Re: advice on fixing a rate for 2008-2010 - Posted by ray@lcorn
Posted by ray@lcorn on November 07, 2005 at 16:35:02:
Paula,
You don’t mention the loan size, or whether there is a pre-payment penalty. Those two factors would play into my decision.
Essentially you’re buying a committment for funds at 7% for two years for $500. Technically that’s known as a hedge, and they’re sold all the time. I doubt your bank is offering an official hedge though… sounds like they are trying to accomodate a customer whom they want to keep.
Remember, what goes up also comes down. We’re in a rising rate environment right now, but just as sure as they rise they will also fall again. The real unknown is how high they will go and for how long. We could easily go full cycle between now and 2008, or not. Buying a hedge takes the sting out of the bee, but make sure the terms are clear.
If there is no prepayment penalty there is no obligation on your part to accept the terms in 2008. If rates are lower than 7% in 2008 you can renegotiate a better deal (and probably get credit for the $500). If they are higher you’ve got the funds locked in. Assuming the loan amount justifies the expense, then it’s cheap insurance.
One last caveat: make sure you get a written committment. Banks and their people are notoriously mobile.
ray
Re: advice on fixing a rate for 2008-2010 - Posted by Patrick S. Lawson
Posted by Patrick S. Lawson on November 07, 2005 at 12:50:52:
It’s not a bad offer. I would take it. IMHO it’s not much of a gamble considering the future outlook on interest rate increases.
Re: advice on fixing a rate for 2008-2010 - Posted by Paula K.
Posted by Paula K. on November 07, 2005 at 18:28:28:
what does “IMHO” mean…? Thanks!
Re: advice on fixing a rate for 2008-2010 - Posted by Paula K.
Posted by Paula K. on November 07, 2005 at 16:26:20:
what does “IMHO” mean…? Thanks!
Re: advice on fixing a rate for 2008-2010 - Posted by Bill Taylor
Posted by Bill Taylor on November 08, 2005 at 06:47:07:
In My Honest Opinion , Paula. I would have had the same question a while back.