builder incentive tied to preferred lender question

[FalconheadWest]

$5000 over the life of the loan is not very much, especially considering the vast majority of people never keep a loan for the life of it. You made it seem like the rate was astronomically different, but to equate to only $5k, it's a tiny difference. Yes, I understand it's the principle that it is different at all, but it's small. I can't imagine if you took this to the higher up at Landon that he wouldn't do it. He's a smart guy. He came from 2 VERY large companies before starting Landon Homes and he knows reputation is everything.

Supreme has always had higher fees from my client's experiences with them.

Again, go beyond your sales rep to someone higher!

[aexchange]

Originally Posted by jlim0930

This is Landon homes and Supreme lending.

I even went up the VP/CFO of the builder and they still refused to even discount the origination fees. Both myself and my wife have A+ credit and we never ever had to pay a premium to get the best rates before.

I did the calculations and with the rate and origination difference i would be under about $5000 for the life of the loan if i went with the preferred lender instead of the outside lender... i guess the 10k in incentives is actually only 5k...

this kind of practice burns me so much having to deal with things like this. i wish there is some place where i can ask for help and report this.

I'm not sure why you are so bummed, this is a relatively easy thing to do.

Assume you are being offered 4.5% (market rate for top credit is around 4%). Ask them to lift your loan to 4.625 or 4.75% (if they are willing) to cover the costs of your loan. This should cover any origination fee plus any potential deposits you may need to put down.

After you've closed, immediately turn around and re-fi with a different lender. You'll be able to shop it around this time and likely get the origination fee waived and likely get a chunk of additional costs covered as well (such as a new appraisal). In this scenario, based on what I've seen, you'd likely be able to get 4.125% with a good chunk of costs covered with top credit.

I literally just did this exact same thing a month ago. Was offered 4.0%, lifted my rate to 4.375% and then when the rates crashed a few weeks ago, locked in at 3.625%. Again, this assumes you have some level of risk tolerance and are able to time the market well, but even then, my goal was really to re-fi at 4.0% and my sheer luck and timing was able to get 3.625%.

[jlim0930]

Originally Posted by FalconheadWest

$5000 over the life of the loan is not very much, especially considering the vast majority of people never keep a loan for the life of it. You made it seem like the rate was astronomically different, but to equate to only $5k, it's a tiny difference. Yes, I understand it's the principle that it is different at all, but it's small. I can't imagine if you took this to the higher up at Landon that he wouldn't do it. He's a smart guy. He came from 2 VERY large companies before starting Landon Homes and he knows reputation is everything.

Supreme has always had higher fees from my client's experiences with them.

Again, go beyond your sales rep to someone higher!

That is the thing.. it wasn't astronomically different and I didn't even ask for the full difference.. All i asked for was just the fee that I was being charged to get a lower rate which by the way was still higher than what I got from the other lender!

[jlim0930]

Originally Posted by aexchange

I'm not sure why you are so bummed, this is a relatively easy thing to do.

Assume you are being offered 4.5% (market rate for top credit is around 4%). Ask them to lift your loan to 4.625 or 4.75% (if they are willing) to cover the costs of your loan. This should cover any origination fee plus any potential deposits you may need to put down.

After you've closed, immediately turn around and re-fi with a different lender. You'll be able to shop it around this time and likely get the origination fee waived and likely get a chunk of additional costs covered as well (such as a new appraisal). In this scenario, based on what I've seen, you'd likely be able to get 4.125% with a good chunk of costs covered with top credit.

I literally just did this exact same thing a month ago. Was offered 4.0%, lifted my rate to 4.375% and then when the rates crashed a few weeks ago, locked in at 3.625%. Again, this assumes you have some level of risk tolerance and are able to time the market well, but even then, my goal was really to re-fi at 4.0% and my sheer luck and timing was able to get 3.625%.

That is awesome! seems like you had the perfect timing! I just wanted to not have to deal with the hassle of doing this...with my luck doing this the rates would jump up before i can refi