Always compare APR (annual percentage rate). That is your actual rate when you factor in all of the lending fees. Example, mortgage company #1 says they can get you 5.5% 30 yr fixed. Mortgage company #2 says they can get you 5.75% on a 30 yr fixed. Most people will go with mortgage company #1, right? However, you MUST factor in their closing costs.. Say mort co #1 is going to charge you $3,500 in closing costs & points, and mortgage co #2 is only charging $1,200, (without knowing your mort loan amount, I cannot figure out true APR, however, after factoring in closing costs, mort co #2, may only have an APR at 5.9% and mort co #1 has a 6.25% APR.) You would be better to go with the 5.75% mort co #2. Bottom line is to compare APR's and Good Faith Estimates.
As a professional REALTOR in the Indianapolis market, my team reviews these types of issues for our clients when buying a home. When purchasing a home, especially in this market, It is absolutely critical for buyers to use a professional, ethical and trustworthy real estate agent to represent their best interest. Keep in mind, it doesn't cost buyers anything to work with an agent. For more information or if you would like to discuss this further, please contact me at 317 846-4888 direct. Thank you! Derek Gutting, The Gutting Group of Keller Williams Realty.