Firts let me tell you that you have 14 days to shop around for a better interest rate without having your credit effected. That is from the date they pulled your credit the first time. You have to work with someone you can trust, in todays market. Your current rate and payment does NOT sound realistic, unless there is something we don't know about in your situation.

Thanks for your question.

While we are in what is termed a "buyers market" you need to be careful with your financing. I get calls every week with "The mortgage company I was working with just went out of business" or "He told me it was X and at closing it was XX""

Now you should get disclosures at within time of application but in the end they mean nothing. Here are a few things to look for:

1. Find someone you are comfortable to work with and has a true intent to earn your business.
2. A pre-approval is not worth the paper it is printed on.
3. Get pre-qualified. This only happens when you provide income, residency, and asset information. Now you still have to deal with the apprasial.
4. Get a few options to compare.
5. Get a guarantee for the brokers controllable closing cost.
6. After pre-qualification get a copy of the rate lock. Until then EVERYONE is just guessing.

Now with your posted quote it is impossible to verify without more information. Based on a 125 selling price with 5k down is a loan LTV around 96% (sounds like FHA) a payment of $1290 would have a interest rate of around 12.625%

Now does the 1290 include taxes and insurance escrows along with mortgage insurance?

If your looking for someone that guarantees cost and rates give me a email at tgrego@getmyratequote.com or 317-714-8080. I also have a $500 lowest cost guarantee.

Kind regards,
Tony Grego - Your place for great rates

i would ask your friends and family for a referral to someone. like joe said, avoid online and "teaser rates" in advertisements. payment has many variables. Principle, interest, taxes, hazard insurance, mortgage insurance, flood insurance (if applicable). From all these variables only the interest, hazard ins, and mortgage insurance would vary. Sounds like you may want to look at an FHA loan. Good Luck

Start at your bank. Then call a reputable, big mortgage lender in your area. Avoid fly-by-night shops or places that advertise only payments and rates in the newspaper.