That’s a catch 22 right? How could that even be possible? No but seriously, you have to dig a bit deeper and get past the “advertisement”, after all it’s a sales pitch right? If you have been paying attention to the main stream media lately you would see headlines like “mortgage rates hit a historic low”, in which there is a lot of truth to but this is not the ONLY thing you need to be looking for when shopping for a home loan.
I get the question from some of my clients, “what are your rates and fees”? Don’t get me wrong I’m perfectly comfortable with answering this but it’s almost like going on a blind date your best friend is trying to set you up for and calling your “date” ahead of time asking if they are attractive! Maybe that’s a poor analogy but it just came to mind so I said it. But regardless, there is a lot more to getting a home loan, I mean let’s face it, the lowest interest rate and fees in the world make no difference if the loan doesn’t close on time or even worse doesn’t close at all.
You can go to Google on any given day and search “lowest mortgage rates” and your going to get a bunch of lead generation sites like Lending Tree, Bankrate etc etc who will sell your information to telemarketing companies who happen to “specialize” in home loans. Or better yet, the fly by night online mortgage company that nobody has even heard of pops up in Googles search results, and better yet you click the link and fill in your information and one of their telemarketers disguised as loan officer call you. Is this really who you want planning one of the biggest investments of your life? I have to ask, if they actually advertised a fair market rate that was about “average” would you call them? Would you pick up the phone and call if they actually showed you the “points” they charge to get the above listed “lowest mortgage rate”? Of course you wouldn’t, their advertisement dollars would be completely wasted if they are not getting the phones ringing right?
I will be willing to “wager” that you will absolutely find a “discount” mortgage that will be “cheaper” than what I will offer you, matter of fact I PROMISE you can find someone that ONLY gets business because they put out advertisements for being the lowest mortgage rates and fees. One thing I can almost guarantee is that there is usually a reason this company doesn’t have boatloads of referrals like myself or my company, or matter of fact any other well known Phoenix Lender. Remember the old saying “you get what you pay for”?
Here is story about something that just happened yesterday, a client who was referred by one of my well known real estate agents called me and said that “hey I was on google and joe blow mortgage company is advertising X rate on a 30 year fixed”. (x rate being a pretty low rate) My first two questions were this,”Fantastic John Smith, you have 17 business days to get your loan closed on time and are they (fly by night online mortgage company) willing to pay your $100 per diem (per day fee) the bank will assess if they don’t close on time? Are they willing to GUARANTEE this to you or are you willing to gamble with a fly by night internet company nobody knows about”? My second question was “did you address with the loan officer that this is a flip transaction (meaning the seller just bought it to immediately sell it to you for an increased profit) and that the sales price is well above a 20% increase from what the seller bought it for?” Let’s just say that even though this company’s rate was about .125% lower (only a difference of $10/mo in principle and interest payment on a $140,000 loan amount) and fees were about $500 less than mine the borrower is continuing his loan with me.
Again, back to the lowest mortgage rates NOT actually being the lowest mortgage rates, it is your job as a consumer to get all of the information first before you make a decision. Yes I know that “shiny low rate” is very tempting. If you are not sure what questions you should be asking, contact me and I will help you make sure that you are protecting yourself. To be honest with you, if a good phoenix real estate agent trusts a particular lender with their “paycheck” over a 30 day period of time on a purchase transaction it’s usually a pretty decent loan officer and I am sure they will do a great job for you.
Thats all I got for today! Use the sharebar on the left and send this to anyone who can benefit thank you!!
-Justin, Electric Loan Officer
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