$20K lender rebate or get lower rate elsewhere

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Submitted by nocommonsense on October 20, 2009 - 12:09pm

Has this subjected been debated here before? I was wondering what you guys think. I would think the lender would charge a higher rate to compensate for the $20K rebate. But I don't know how much higher than what one can find shopping around. Also, the rebate would go towards lowing the purchase price, which would in turn lower the tax bill.

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It has been debated alot. It
Submitted by SD Realtor on October 20, 2009 - 12:50pm.

It has been debated alot. It is a pretty easy calculation to see if it is worth your time but you need to get accurate estimates from other lenders not just on the loan but on closing costs and that is super hard to do.

The biggest problem is the closing date. If the home you want to buy is not going to close escrow for 5 months or so then nobody can quote you a rate right now because nobody will give you a 5 month lock. Sometimes the preferred lenders give a long lock and they may have a 1 time relock if the rates go down. It is a tough call to make. Overall the lenders that are preferred by the builder are fairly competitive but do your homework and check other outsiders.

Thanks.
Submitted by nocommonsense on October 20, 2009 - 2:36pm.

Thanks.