Future lenders with lowest rates

[mixxalot]

I am currently saving for the downturn. In a few years I plan to buy a modest home. What lenders usually have best rates: banks, savings and loans or private firms?

I see a lot of fees with firms on bankrate.com that have lower interest rates which makes no sense whereas banks have no or low fees but a higher interest rate for a 30 year fixed rate loan.

[temeculaguy]

It may be too pre-mature to shop a year or two out, I think the lending landscape is going to change between now and then. Best way to do it is to get a good faith estimate from any lender and take it to another or a broker and let them try to beat it, like buying anything shopping around usually is beneficial. Compare the fees, payment, terms, etc., this stuff is so fluid that it doesn’t even make sense to shop around until you are within 90 days out and even then things change in those 90 days. HLS is a longtime poster and I have e-mailed him specific questions and gotten quality answers. I will probably e-mail him and give him a chance to beat my lender when the time comes, it costs you nothing to let the market compete.

[temeculaguy]

It may be too pre-mature to shop a year or two out, I think the lending landscape is going to change between now and then. Best way to do it is to get a good faith estimate from any lender and take it to another or a broker and let them try to beat it, like buying anything shopping around usually is beneficial. Compare the fees, payment, terms, etc., this stuff is so fluid that it doesn’t even make sense to shop around until you are within 90 days out and even then things change in those 90 days. HLS is a longtime poster and I have e-mailed him specific questions and gotten quality answers. I will probably e-mail him and give him a chance to beat my lender when the time comes, it costs you nothing to let the market compete.

[temeculaguy]

It may be too pre-mature to shop a year or two out, I think the lending landscape is going to change between now and then. Best way to do it is to get a good faith estimate from any lender and take it to another or a broker and let them try to beat it, like buying anything shopping around usually is beneficial. Compare the fees, payment, terms, etc., this stuff is so fluid that it doesn’t even make sense to shop around until you are within 90 days out and even then things change in those 90 days. HLS is a longtime poster and I have e-mailed him specific questions and gotten quality answers. I will probably e-mail him and give him a chance to beat my lender when the time comes, it costs you nothing to let the market compete.

[HLS]

Thanks Temec,,

I’m still out here, actually been very busy.

A GOOD FAITH ESTIMATE (GFE) is really just an estimate that can be totally inaccurate, without any consequences.
In tiny print, it states that it’s only an estimate, and that fees can change. They are useful for lying from those that choose to, not really good for shopping.

Since rates change every day, until you want to lock, the quoted rate means nothing, until it is locked AND you are approved. It’s really frustrating for the consumer.

A HUD statement from escrow is MUCH more accurate, but you usually don’t see one until signing.

If shopping with a broker, just tell them to cut through the crap and ask them how much they need to make on your loan.
They are only in control of their fees and the rate that they offer you.

Title, escrow, and lender underwriting are out of their control. You can often choose the first two yourself if you wish.

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.

A mortgage broker et al doesn’t (legally) get a penny back from Title, Escrow, or Appraiser, …and if they are getting anything from the lender it MUST be disclosed, but only in one spot on one line on your closing statement.

If it is a direct lender, who is lending their own money,
(BANKS, etc) the rules are completely different. They WILL NOT and DO NOT have to disclose if you were overcharged. They may tell you that they don’t have any fees, but it’s just built into the rate.

If you find someone that you can trust, it’s not a game. You may find out that calling around will just lead you to getting teaser rates, misquoted, and misled.

Nobody will do it for you for free, you will pay one way or another. Getting you into the best loan that you qualify for and can be approved for is what you will be paying for.

It might be a bank, it might be a broker, etc.
No simple answer.

[HLS]

Thanks Temec,,

I’m still out here, actually been very busy.

A GOOD FAITH ESTIMATE (GFE) is really just an estimate that can be totally inaccurate, without any consequences.
In tiny print, it states that it’s only an estimate, and that fees can change. They are useful for lying from those that choose to, not really good for shopping.

Since rates change every day, until you want to lock, the quoted rate means nothing, until it is locked AND you are approved. It’s really frustrating for the consumer.

A HUD statement from escrow is MUCH more accurate, but you usually don’t see one until signing.

If shopping with a broker, just tell them to cut through the crap and ask them how much they need to make on your loan.
They are only in control of their fees and the rate that they offer you.

Title, escrow, and lender underwriting are out of their control. You can often choose the first two yourself if you wish.

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.

A mortgage broker et al doesn’t (legally) get a penny back from Title, Escrow, or Appraiser, …and if they are getting anything from the lender it MUST be disclosed, but only in one spot on one line on your closing statement.

If it is a direct lender, who is lending their own money,
(BANKS, etc) the rules are completely different. They WILL NOT and DO NOT have to disclose if you were overcharged. They may tell you that they don’t have any fees, but it’s just built into the rate.

If you find someone that you can trust, it’s not a game. You may find out that calling around will just lead you to getting teaser rates, misquoted, and misled.

Nobody will do it for you for free, you will pay one way or another. Getting you into the best loan that you qualify for and can be approved for is what you will be paying for.

It might be a bank, it might be a broker, etc.
No simple answer.

[HLS]

Thanks Temec,,

I’m still out here, actually been very busy.

A GOOD FAITH ESTIMATE (GFE) is really just an estimate that can be totally inaccurate, without any consequences.
In tiny print, it states that it’s only an estimate, and that fees can change. They are useful for lying from those that choose to, not really good for shopping.

Since rates change every day, until you want to lock, the quoted rate means nothing, until it is locked AND you are approved. It’s really frustrating for the consumer.

A HUD statement from escrow is MUCH more accurate, but you usually don’t see one until signing.

If shopping with a broker, just tell them to cut through the crap and ask them how much they need to make on your loan.
They are only in control of their fees and the rate that they offer you.

Title, escrow, and lender underwriting are out of their control. You can often choose the first two yourself if you wish.

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.

A mortgage broker et al doesn’t (legally) get a penny back from Title, Escrow, or Appraiser, …and if they are getting anything from the lender it MUST be disclosed, but only in one spot on one line on your closing statement.

If it is a direct lender, who is lending their own money,
(BANKS, etc) the rules are completely different. They WILL NOT and DO NOT have to disclose if you were overcharged. They may tell you that they don’t have any fees, but it’s just built into the rate.

If you find someone that you can trust, it’s not a game. You may find out that calling around will just lead you to getting teaser rates, misquoted, and misled.

Nobody will do it for you for free, you will pay one way or another. Getting you into the best loan that you qualify for and can be approved for is what you will be paying for.

It might be a bank, it might be a broker, etc.
No simple answer.

[mixxalot]

Shopping for mortgage the wise way

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.

[mixxalot]

Shopping for mortgage the wise way

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.

[mixxalot]

Shopping for mortgage the wise way

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.

[HLS]

Just Ask…Buying down the rate is “discount points” that get paid to the lender. You are giving them pure profit up front, in exchange for a lower rate and payment for the life of the loan..You CANNOT be overcharged in rate AND buy down the rate, it just isn’t possible.

Many mortgage folks will not discuss buying down the rate with you, because they will not get a penny of commission from the lender.
The buy down is different on every loan, and isn’t a set amount.
It might cost 5/8ths to buy the rate down 1/8th, which means that it will take well over 5 years to make pay off, but for someone who ends up keeping the loan for 10 years or longer, it will save them a small fortune. The buy down fee is the same dollar amount whether you keep the loan 2 years or 30 years.

It is possible to get a 30 year fixed in the mid 5’s today, it just isn’t cheap.

I would have liked to have been a fly on the wall with the discussions that you had.
The loans aren’t a rip off… It’s many of the people “selling” them that are the rip offs.
It’s not necessarilty foolish. It depends what your needs are and what you qualify for.

There aren’t really “subprime loans”…. there are subprime BORROWERS and lenders who lend to subprime borrowers.
Prime borrowers can get similar loans. ARMS, 2 YR, 3 YR, Option Arms, etc, The big difference is that virtually all subprime borrowers get a prepayment penalty.

Sometimes a prime borrower can get a better deal by taking a loan from a subprime lender, with a prepay.

Finding someone to trust isn’t easy, but it is possible.

The back end commission will probably ONLY show up on one line of the final “estimated closing statement” as YSP POC
and be off to the left of the 2 columns of numbers.

THIS IS ONLY TRUE WITH LOANS THROUGH BROKERS.
Mortgage brokers were cutting into banking business profits, so the banking industry lobbied so that brokers have to disclose back end commissions BUT THE BANKS DON’T.

It gives the illusion that banks or direct lenders charge less, which isn’t necessarily true. When banks compete, you DON’T always win. They could be cheaper, but they might not.

The ONLY way that gets paid is because the borrower was charged a higher rate than they qualified for and the lender is rewarding the mortgage pro for screwing his client (often a friend or family member who was promised a no cost loan) Isn’t that special ??

[HLS]

Just Ask…Buying down the rate is “discount points” that get paid to the lender. You are giving them pure profit up front, in exchange for a lower rate and payment for the life of the loan..You CANNOT be overcharged in rate AND buy down the rate, it just isn’t possible.

Many mortgage folks will not discuss buying down the rate with you, because they will not get a penny of commission from the lender.
The buy down is different on every loan, and isn’t a set amount.
It might cost 5/8ths to buy the rate down 1/8th, which means that it will take well over 5 years to make pay off, but for someone who ends up keeping the loan for 10 years or longer, it will save them a small fortune. The buy down fee is the same dollar amount whether you keep the loan 2 years or 30 years.

It is possible to get a 30 year fixed in the mid 5’s today, it just isn’t cheap.

I would have liked to have been a fly on the wall with the discussions that you had.
The loans aren’t a rip off… It’s many of the people “selling” them that are the rip offs.
It’s not necessarilty foolish. It depends what your needs are and what you qualify for.

There aren’t really “subprime loans”…. there are subprime BORROWERS and lenders who lend to subprime borrowers.
Prime borrowers can get similar loans. ARMS, 2 YR, 3 YR, Option Arms, etc, The big difference is that virtually all subprime borrowers get a prepayment penalty.

Sometimes a prime borrower can get a better deal by taking a loan from a subprime lender, with a prepay.

Finding someone to trust isn’t easy, but it is possible.

The back end commission will probably ONLY show up on one line of the final “estimated closing statement” as YSP POC
and be off to the left of the 2 columns of numbers.

THIS IS ONLY TRUE WITH LOANS THROUGH BROKERS.
Mortgage brokers were cutting into banking business profits, so the banking industry lobbied so that brokers have to disclose back end commissions BUT THE BANKS DON’T.

It gives the illusion that banks or direct lenders charge less, which isn’t necessarily true. When banks compete, you DON’T always win. They could be cheaper, but they might not.

The ONLY way that gets paid is because the borrower was charged a higher rate than they qualified for and the lender is rewarding the mortgage pro for screwing his client (often a friend or family member who was promised a no cost loan) Isn’t that special ??

[HLS]

Just Ask…Buying down the rate is “discount points” that get paid to the lender. You are giving them pure profit up front, in exchange for a lower rate and payment for the life of the loan..You CANNOT be overcharged in rate AND buy down the rate, it just isn’t possible.

Many mortgage folks will not discuss buying down the rate with you, because they will not get a penny of commission from the lender.
The buy down is different on every loan, and isn’t a set amount.
It might cost 5/8ths to buy the rate down 1/8th, which means that it will take well over 5 years to make pay off, but for someone who ends up keeping the loan for 10 years or longer, it will save them a small fortune. The buy down fee is the same dollar amount whether you keep the loan 2 years or 30 years.

It is possible to get a 30 year fixed in the mid 5’s today, it just isn’t cheap.

I would have liked to have been a fly on the wall with the discussions that you had.
The loans aren’t a rip off… It’s many of the people “selling” them that are the rip offs.
It’s not necessarilty foolish. It depends what your needs are and what you qualify for.

There aren’t really “subprime loans”…. there are subprime BORROWERS and lenders who lend to subprime borrowers.
Prime borrowers can get similar loans. ARMS, 2 YR, 3 YR, Option Arms, etc, The big difference is that virtually all subprime borrowers get a prepayment penalty.

Sometimes a prime borrower can get a better deal by taking a loan from a subprime lender, with a prepay.

Finding someone to trust isn’t easy, but it is possible.

The back end commission will probably ONLY show up on one line of the final “estimated closing statement” as YSP POC
and be off to the left of the 2 columns of numbers.

THIS IS ONLY TRUE WITH LOANS THROUGH BROKERS.
Mortgage brokers were cutting into banking business profits, so the banking industry lobbied so that brokers have to disclose back end commissions BUT THE BANKS DON’T.

It gives the illusion that banks or direct lenders charge less, which isn’t necessarily true. When banks compete, you DON’T always win. They could be cheaper, but they might not.

The ONLY way that gets paid is because the borrower was charged a higher rate than they qualified for and the lender is rewarding the mortgage pro for screwing his client (often a friend or family member who was promised a no cost loan) Isn’t that special ??

[Author]

Posts