Ask them if they will give you the PAR wholesale rate, so they don’t get any commission from the lender on the back end for overcharging you. It’s also known as YSP.
Also get buy down options. It is IMPOSSIBLE for them to get a commission if you pay discount points and buy down the rate.
If you want a “no cost loan” ask them to explain the fees and true costs to you,(and see if they even can) so you will know which is a better loan for you.
You will never see this back end commission until the day that you are signing docs, and if you don’t know where to look, you won’t even know it.
Contrary to what many think, The industry is highly regulated and everything must be disclosed.
Thanks for the tips.
I have a couple of questions:
1. How do I buy down options to buy down the rate?
2. Is there a way to find out the back end commission before sign the papers?
I was just discussing how much of a rip off the ARM and subprime mortgages are with my parents and friends and while loan paperwork take time to understand its foolish to get such a risky suicide loan.
