What to know about "rate shopping."
Looking for a MORTGAGE, auto or student loan may cause multiple lenders to request your credit report, even though you are only looking for one loan. To compensate for this, the score ignores mortgage, auto, and student loan inquiries made in the 30 days prior to scoring.
So, if you find a loan within 30 days, the inquiries won't affect your score while you're rate shopping. In addition, the score looks on your credit report for mortgage, auto, and student loan inquiries older than 30 days. If it finds some, it counts those inquiries that fall in a typical shopping period as just one inquiry when determining your score. For FICO scores calculated from older versions of the scoring formula, this shopping period is any 14 day span. For FICO scores calculated from the newest versions of the scoring formula, this shopping period is any 45 day span.
Each lender chooses which version of the FICO scoring formula it wants the credit reporting agency to use to calculate your FICO score.
PS, my name is Gregorio, not Gregory; attention to detail is a skill a loan officer should possess.
As for the credit; you are still wrong. The credit is $14,000. It's disclosed as $14,000 on the GFE, it's disclosed as $14,000 on the HUD... why... because it is $14,000.
Have I mentioned that All YSP is credited to the borrower?
5.75% is too high
5.125% is still too high
And $14,000 credited to the borrower, is $14,000 credited to the borrower. Its' not $11,500 because there is a $3500 origination fee just as it would not be $10,750 if you include a $750 escrow fee. It's still $14,000 that the borrower uses to pay settlement fees. I am baffled at why you don't understand the concept of a credit being used "to reduce settlement charges",
I suggest that if 15 months in, you still don't understand RESPA, you will have serious difficulties come 4/1/11 at 12:01AM because it's obvious you have no understanding of disclosure.
I can only wish you luck.
PS: Gregory, So now that you are getting paid (and I am glad you do because you seem to be putting a lot of energy and excitement into your work) the credit for closing costs to the buyer, for a 5.125 % rate, will be $11,500 and no longer $14,000. I am glad you clarified that
Start with your credit union (if you have one), then off to bigger names... Citi, Bank of America, etc.
Should you need some more help, I will be glad to help.
Debbie Henninger, REALTOR
Keller Williams Realty
If you do charge point(s) then mention it ."
Are you serious?
Have you done a GFE since 1/1/2010?
GFE 2010 page #2 Line #2 box #2 would read as follows:
You receive a credit of $14,000 for the interest rate of 5.125%.
This credit REDUCES your settlement charges.
In case you have been asleep for 15 months, YSP is disclosed as a credit to the borrower that offsets closing costs. If I charged a 1% origination fee that would still leave $11,500 credit for closing costs.
I'll say it one last time for you. At 5.125%, the credit would be too much as there are not enough closing costs. The borrower would end up getting money back which is not allowed. The only solution is to either charge an enormous origination fee to absorb it, or to offer the consumer a rate, as I stated in my original post: "from this planet.
I sure hope you are joking.
If you do charge point(s) then mention it .
I do stand to the "With No points, you will be looking at 4.750 - 4.875%..."
"Don't be lured by people that tell you that they will refund $14,000 on a 5.125% because they either do not get paid or will have to charge you point(s) for their service. "
First of all, I don't appreciate the insinuation. Secondly, on my rate sheet as of 3/29/2011, 5.125% is at 104.00. That means that per the GFE 2010, It would show a $14,000 credit as ALL YSP is credited to the borrower. This credit would be used to offset title, escrow, origination and all closing costs.
If someone does not understand how to properly disclose this then that's a serious issue.
My point was that even 5.125% would actually be TOO HIGH and there would be TOO MUCH rebate. I don't "lure" anyone, I speak FACTS and the FACT is that 5.75% with a 640 on an FHA loan as of today is ridiculous. 5.125% is equally ridiculous.
As for this comment: "With No points, you will be looking at 4.750 - 4.875%..."
I strongly suggest someone find better sources, I clearly see 4.375% at par with a 640 on a 30 year FHA loan.
If you'd prefer to watch a short video that explains how credit scores work with the mortgage process, you can click on the link below. It's important to shop for the best rate, and more important to know how to best do that.
If I have it correct you say your agent referred you to a lender that is quoting 5.75% and you are considering offering to purchase a home that is $50k to $70 overpriced? And you are concerned about "stepping on toes" if you raise these issues with your agent?
Forums like this are difficult to get all the facts out into the open and there may be a very viable reason why you are being quoted the 5.75% (maybe that's just the rate the Loan Officer stuck in to get you pre-approved) and maybe your agent will tell you not to make that overpriced offer. Or maybe the home really isn't overpriced.
In any case you have every reason to have doubt in the professionalism and knowledge of the people you have working for you right now. You need to have clear and detailed conversations with both the agent and the loan officer and see what they have to say.
I've always advised the agents I work with to pay attention to the answers from the loan officer - if they are specific and they don't waffle they are probably telling the truth. If the answers are vague and don't make sense then it's possible they either don't know what they are talking about or they are not telling the truth.
You certainly don't owe either the agent or the loan officer any allegiance if they have not been honest and ethical in their dealings but I'd encourage you to have a heart to hear conversation with them both before you just cut them loose.
Good luck and feel free to post back with any follow up questions.
With No points, you will be looking at 4.750 - 4.875%...
Don't be lured by people that tell you that they will refund $14,000 on a 5.125% because they either do not get paid or will have to charge you point(s) for their service.
I answered this question for you on Zillow as well. I dont think it's wise to sign up for these sites you mention as they will run your credit several times without asking. If you wish to shop around, go to major banks and see what they have to offer. Once you are happy with your loan package, I would be happy to assist you in finding a home of your dreams :)
Find a new lender or have them quote you a rate from this planet.
You have it right, a lower rate will help you qualify for a higher loan amount;
$350,000.00 loan amount @ a rate of 5.750%, 30 yr Fixed Mortgage , = $2,042.50 (principal and interest)
$385,955.00 loan amount @ a rate of 4.875%, 30 yr Fixed Mortgage , = $2,042.50 (principal and interest)
The lender's quote is about one (1) percentage point over today's rate for a 30 yr fixed FHA, WITH 0 POINTS.. For a $350,000 loan amount, amortized over 30 yrs, this represents a difference of about $200/ month.
Is the friend of the family, the Realtor or the Mortgage Broker?
Remember that your agent works for you, and should look out for your best interests. Your agent should be able to help you look around for the best rate if that's what you want to do....
If you don't have an accepted offer, then there won't be an appraisal (from you or your lender). Even if the seller did their own appraisal, your lender of choice won't use that appraisal for your loan.
Don't feel like you have to pay a higher price (higher than what?)....consider the current market value of the property. And again, your agent should be able to do the comps for you. It's part of what a realtor does for her clients.
Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
1. Selection of an appraiser (will they choose an appraiser who is from the immediate area, or from several cities, even counties away?). An appraiser unfamiliar with the area may come up with a questionable market value
2. If you need to get hold of the lender when questions/problems arise, do you have to go through a phone menu, is the lender in the same state or time zone?
I've had two clients who applied online (one of them with Quicken Loans), and both times, the process was horrendous for the reasons just mentioned. Many realtors will likely suggest that you use local lenders. You can shop around just as easily. Ask your realtor for suggestions.
The rate is high for a conforming 30-year fixed rate FHA loan.
Feel free to email or to call me for a quote.
Senior Loan Consultant
By Referral Only
All California Mortgage
P: (415) 464-8261
C: (415) 378-7508
F: (415) 464-2367
NMLS 304353 - DRE 01380701
If you want to talk to a great lender, try Celeste Anderson at RPM Mortgage. Her office number is 925-295-9339. She's the person I refer my clients to.
Click on my web reference website to get my contact info for me to pass along the info to you..