Mark, Home Buyer in Sacramento County, CA

Par rate loan for 1% commission?

Asked by Mark, Sacramento County, CA Mon May 19, 2008

Will either mortgage brokers or mortgage bankers do this for a $200,000 purchase price? Or is the price too low for them to make the average commission in this area?

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Alex Amaro, Agent, Sacramento, CA
Mon May 19, 2008
Good afternoon Mark,
I started my real estate career in mortgage and I would like to tell you this. There is a lot to know and it is a job that takes time and experience to be very good and successful. That said, you can always find someone willing to make 1%. All I can suggest is to find someone that you are confident in. If you find some fly by night broker just trying to make a buck it may be more of a headache than anything.
Next, I would suggest getting your own ducks in a row. Let the loan officer know that you will be very proactive. Make sure you get him all the paperwork he asks for promptly. Assure him that you will be a reasonable client.
I say this because in my experience, the clients that wanted to pay me the least turned out to be the most difficult clients and costing the most amount of my time. Unless someone assures me and proves to me that this is the case with them (perhaps by showing up to my office with all paperwork already in hand) I will not take them as a client. This is not because I am making "less money" with the client. It is because I want to work with clients that appreciate the hard work I do for them.
Any more specific questions, please feel free to contact me.
Good luck Mark!

Alex Amaro
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, , Sacramento, CA
Sat Jul 19, 2008
That is fair. If it is FHA I charge a point. If it is conventional no points.
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Jeff Marr, Mortgage Broker Or Lender, Roseville, CA
Wed May 21, 2008
Mark - any loan officer that plans on remaining in business should be, and will be charging more than 1%. With loan conversion rates falling dramatically in recent years, along with falling loan amounts, a loan officer simply can't make a living by ALSO reducing the points their charging. Also, keep in mind the typical loan officer shares roughly 50% of their income with their broker, so using a $200k L/A yields just $1000 in pre-tax income. Expect to pay between 1.5% - 2% for a seasoned loan officer, one that will get your loan closed. Reducing your loan costs means nothing if your L/O can't close your loan!

just my 2 cents worth!

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