At the end of the day, when you have gone through all the hard work of finding the right home, you are going to need a SOLID lender, the one who delivers the home loan with the costs and rates you agreed to at the beginning. The Realtors recommendation is probably solid because Realtors like to get paid for all their work and if lenders dont perform, they dont get recommended by Realtors.
Which makes it worth stating that if you should be using an experience Realtor that you are satisfied is doing a good job for you, this is just as important.
There is A LOT to put together in a home purchase. You are smart to resource your concerns and focus on the entire picture and cast. Good luck!
There is no such thing as a no cost loan. Banks don't give money away for free. You'll pay a higher rate if you follow the no cost loan strategy. The rates fluctuate daily and you will drive yourself nuts trying to figure out your rate before you can lock. It's going to be what it is, what it is when you go to lock. News, government etc. can cause changes in the market at any moment. I just looked at the rates on Zillow and they start at 3.750 and go over 4.0 for this moment in time.
Ask for a GFE. Once they issue that document they can't go higher in fees and rates, but they can go lower. And like anything else, you can shop fees to death, but if you save $500 and the lender you pick, screws up your loan and can't close your deal, you could lose your deposit. Looking for a seasoned professional, preferable with an office you can walk through the front door with some accountability and a good reputation is like buying a little insurance. You don't need a fire drill after you waive loan contingencies because someone promised you the moon for lower fees.
Here is a link to a Video walk through of the GFE. There area couple land-mines on that form so be careful. http://homebuysblog.com/2010/06/01/video-blog-gfe-2010-simi-
Here is an idea of who pays for what in California: http://homebuysblog.com/2011/08/11/who-pays-for-what-simi-va
One thing I have to stress is that California has different customs and laws in real estate transactions - vastly different than other states. What people do in other states really does not matter. What matters is how it is done where you are selling and buying a home. Our 17 day contingency period is standard across the state in our CAR form. 17 days was not an arbitrary number plucked from the skies. A battalion of attorneys and many many cases of litigation have lead to the formation of the CAR purchase agreement. Our contingency in our CAR purchase agreement as it sits right now is not passive. You have to waive those contingencies in writing (if you did not alter or amend the contract language). Yes that number can be negotiated. You have representation? If so, then the agent that is privy to all the ins and outs of your situation can make a far better consultation base on the situation at hand.
California gets even more interesting because the list of fees I linked in that article I linked, is what is customary for Ventura County. In northern California they do it much differently. Seek advise from season professionals who work the area your are transacting in.
I feel like your intuition is spot on...so keep listening to it. I also feel that you are having questions about your real estate agent based on another question you posted. Proceed cautiously. Good luck.
CA DRE 01775528
1) Same types of inquiries will not affect your score (mortgage vs. auto loan vs. credit card, etc.)
2) This is referred to as "double app'ing" and it's a wise way to position yourself for financing success, as it puts you in the driver's seat. You may have to pay for 2 appraisals, though.
3) Check out this website to learn & compare: http://www.myprospectmortgage.com/sgilman/
1. if I choose to work with the other lender, I'll need to give him copies of my bank statements, paystubs, tax returns, etc. And he'll also have to run my credit. Since my realtor's lender already ran my credit when processing my paper work, will it hurt my credit to have the other lender run my credit as well?
2. My purchase agreement says I have 17 days to remove all contingencies. Let's assume I ask the competing the lender to process my paper work, do the credit check, etc.... How do I "manage" both lenders? At what point in the 17-day period do I tell them to lock in my rate and give me a final answer?
3. Regarding Barry Shapiro's comment about direct lender vs. loan broker, what's the difference? How do I know which one is which?
Rates did go up a bit this week, but if you don't' feel comfortable with the quotes you've been given, I suggest you do some rate shopping.
I would also suggest you discuss the situation with your realtor, since your realtor referred this lender to you.
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