sgip
Well-known member
Couple of things:
1) If you get a quote now, it's fiction. The loan cannot be locked. This means comparison between lenders is impossible. Yes, you have a 4.125% quote, but someone else can quote 3.875% but never deliver on it. Don't take the bait, unless you like being gaffed.
2) When you get a quote and the lender says "I'll match any offer", what that really means is "I gave you my just kidding price, and will lower it only when the deal is going away". Is that really the kind of business method to be associated with considering the magnitude of a new home purchase?
3) Mortgage rates are so thinly spread between companies that you really are only going to get about $500 to $1,000 off between lenders who give you an honest quote (see below).
4) A low rate quote that's locked does not mean you'll get that rate! Some Internet lenders are quoting loan terms from The Bank Formerly Known as WAMU. If you are buying a Condo, it's highly unlikely you'll close efficiently with that bank because of their very difficult Condo approval rules. What then? Your lender pulls the plug and sends you to an easier lender, closing at market rates, not the low rate you were quoted. So, for all that running around your net benefit is zero. Why then pursue that low rate when the real question is this: Can you get my purchase closed at a market rate?
There is really only one way to get an honest rate quote so you can make an informed decision.
A) 60 days out (a builder requirement, and the earliest most companies will lock) you ask 3 lenders on a specific day to provide you with their "Best and final" rates and terms in writing. It has to be including or excluding impounds so you'll get an accurate idea of pricing.
You also must get their "float down" policy in writing. If it's not in writing, it doesn't exist.
Some lenders might say they need an application, or a credit report, or some other commitment to get pricing. Clearly they aren't working to earn your business. Move on from them.
B) Pick one of those mortgage loan officers to go through with you each lenders written offer to glean out the lender only fees and the lender's loan credits. You're not comparing the third party fees. Remember, don't be swayed by "oh, I'll match whatever's the best price". That should have been done already by each lender.
C) Since you already know you're going to be within .125% or $500 of each of these three offers, providing that they've been deciphered clearly, make a commitment, lock the rate, and stick with it.
I can tell you this as a certain fact: You're head will spin 360 degrees the moment you lock, because a better rate from someone will come up. The antidote? Remember that a quoted rate is NEVER a deliverable rate, so why fiddle around with things at this stage? You've got a competitive, locked rate with a known float down option.
Enjoy the remainder of the purchase process from this point forward. You've taken care of one of the important things within your transaction that needed to be accomplished honestly and professionally. The time is now upon you to relax and gently glide towards closing your new home.
My .02c
1) If you get a quote now, it's fiction. The loan cannot be locked. This means comparison between lenders is impossible. Yes, you have a 4.125% quote, but someone else can quote 3.875% but never deliver on it. Don't take the bait, unless you like being gaffed.
2) When you get a quote and the lender says "I'll match any offer", what that really means is "I gave you my just kidding price, and will lower it only when the deal is going away". Is that really the kind of business method to be associated with considering the magnitude of a new home purchase?
3) Mortgage rates are so thinly spread between companies that you really are only going to get about $500 to $1,000 off between lenders who give you an honest quote (see below).
4) A low rate quote that's locked does not mean you'll get that rate! Some Internet lenders are quoting loan terms from The Bank Formerly Known as WAMU. If you are buying a Condo, it's highly unlikely you'll close efficiently with that bank because of their very difficult Condo approval rules. What then? Your lender pulls the plug and sends you to an easier lender, closing at market rates, not the low rate you were quoted. So, for all that running around your net benefit is zero. Why then pursue that low rate when the real question is this: Can you get my purchase closed at a market rate?
There is really only one way to get an honest rate quote so you can make an informed decision.
A) 60 days out (a builder requirement, and the earliest most companies will lock) you ask 3 lenders on a specific day to provide you with their "Best and final" rates and terms in writing. It has to be including or excluding impounds so you'll get an accurate idea of pricing.
You also must get their "float down" policy in writing. If it's not in writing, it doesn't exist.
Some lenders might say they need an application, or a credit report, or some other commitment to get pricing. Clearly they aren't working to earn your business. Move on from them.
B) Pick one of those mortgage loan officers to go through with you each lenders written offer to glean out the lender only fees and the lender's loan credits. You're not comparing the third party fees. Remember, don't be swayed by "oh, I'll match whatever's the best price". That should have been done already by each lender.
C) Since you already know you're going to be within .125% or $500 of each of these three offers, providing that they've been deciphered clearly, make a commitment, lock the rate, and stick with it.
I can tell you this as a certain fact: You're head will spin 360 degrees the moment you lock, because a better rate from someone will come up. The antidote? Remember that a quoted rate is NEVER a deliverable rate, so why fiddle around with things at this stage? You've got a competitive, locked rate with a known float down option.
Enjoy the remainder of the purchase process from this point forward. You've taken care of one of the important things within your transaction that needed to be accomplished honestly and professionally. The time is now upon you to relax and gently glide towards closing your new home.
My .02c
