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This is my first time purchasing a house, and getting confused and frustrated speaking with all of these mortgage people giving me different numbers and rates.
I would be putting 20% down and have 760+ credit
First I was recommended a mortgage broker, after working with him for a few days and providing the documentation he ends up quoting me 3.875% rate.
I wasn't satisfied with this rate so I went to Chase and got a rate quote of 3.675%. He told me that this mortgage broker also didn't disclose some normal fees such as the title insurance fee and he was right the broker didn't list that in the closing cost estimate. Chase offers a 'lender credit' but i dont know this sounds like a scam.
I'm thinking of shopping around more but every place I call wants to run my credit, I don't want to harm my credit score. Should I call these places and have them run my credit to get the score?
What about online banks like quickenloans or something like that? Does it affect the ability to get the mortgage and would their appraisers not know the local area and more likely to give a bad appraisal.
I used to be an online mortgage salesperson. My honest advice (then and now) is that no first time buyer should be using an online lender.
You need someone to 'hold your hand' and that's nothing to be ashamed about. This is a comlex and sometimes complicated process. It's frustrating (as you've already found) and stressful. It's also the biggest investment and risk of your financial life. Don't take that as such a small thing.
(ETA: I'm still a fan of online lenders for educated consumers who are doing a refi, or maybe an experienced homeowner getting a mortgage. But not newbies. NEVER.)
My advice: Find another local broker - get a referral from your Realtor or someone else who has financial savvy. Realtors tend to give good referrals because they don't get paid if your loan doesn't close, so they have skin in the game. Also, check out your local credit unions. Many have excellent rates and do a great job.
No, they do not have to run your credit to give you a quote, but you need to understand that anything they 'quote' without a credit report isn't really a quote. It's more like a 'good guess' based on facts you gave them. Just tell them your scores (all three, not just one) and they should be able to go from there. Once you find somebody you're comfortable with, then they will HAVE to run the credit, so don't get too obnoxious about it.
I was a huge fan of Chase Bank when we lived in AZ - used them for years for personal and well as my business accounts. I did have a line of credit with them several times. Based on what I read here and elsewhere, I probably wouldn't use them for a mortgage. BUT I wouldn't use any big bank for a mortgage - not Wells Fargo, BofA or Chase. They delay, delay, hand off the file to another person in another cubicle, delay, change jobs, delay, lose the file, delay. Don't do it.
Anybody that is stressing out over TWO TENTHS of percent difference in 30 year mortgages ought to reconsider buying a home, weekly swings larger than that are common right up until you lock your rate. How tight are you planning your budget -- are you going to have timer on your shower and only use candles because of fears of "high" utility costs???
The best source for a mortgage for a first time buyer is almost always a CREDIT UNION, they generally have classes designed to help borrowers understand the whole process.
Second best source is probably a mortgage broker, but you should get a referral for a broker that understands the issues that first time buyers face. It is helpful for a new buyer to have someone that takes the time to honestly and thoroughly explain everything.
If the buyer has accounts at a smaller local / regional type bank that can be an acceptable option, many essentially just give a desk to a mortgage broker -- lending and selling loans on the secondary market is a commodity!
Nationwide banks rarely have staff that really completes the whole lending process. Most let some guy or gal in a blue shirt that sat through a few online training courses "originate" the loan and then their national call center handles everything else. The folks in call centers often have goofy schedules of just a few hours a week with many "handoffs" and lots of opportunities for messing things up...
Finally, the online lenders use a similar approach, lots of under-trained call center workers with part time schedules. I do think that for folks with very straightforward income for a regular paychecks, and facility with online banking the lenders like Quicken who've used technology to remove people from the process can be worth considering, but if your finances are more complicated or you need a human involved to explain anything it is not appropriate ...
gus030, the mortgage process is indeed a very complicated one and I would advise you to call around and find a loan officer either at a credit union, broker shop or bank, who will take the time to sit down with you and discuss your needs and goals and concerns. An LO who cares about his/her client will make sure you understand all the closing cost figures, rate quotes and the general process from contract to close.
I would never ever advise a first-time buyer to go through an online mortgage company, especially to save 1/8 of a point. You need someone whom you can look in the eye and call after hours when needed. Those LOs are out there. Keep calling until you get a warm fuzzy and then make an appointment to meet in person.
I work with A LOT of first-time home buyers--mostly military--and they are actually my favorite clients to work with. I take great pride in educating my clients and making sure they know all the ins and outs of the process. I also make myself available after working hours and on weekends when they need me. I've been in the trenches a long time and know of many horror stories. My goal is to make sure a client's first home buying experience is an excellent one so they don't ever second guess their decision or ever leave a closing feeling like they've been ripped off.
Do your due diligence and call around until you find a local loan officer you trust and are comfortable with. Good luck to you!
Gus, Gus, Gus.....go talk to a lender. You don't mention your income or location, so I can't tell you if you qualify for various programs, but I can tell you who can. FTHB (first time homebuyer) programs are not only for the down payment, but the interest rate as well, some even offer a break in closing costs.
Look for a local correspondent lender or a community bank with a full menu or loan offerings. A loan officer can size up if you really should dump 20% down now.....do you have funds, after? If you go with PMI, your rate will be better (the loan level pricing adjustments - or how they calculate Fannie rates, a 90% or 95% loan always has a better rate than 80%). Then, there's a sneaky trick, if you take a loan plan with PMI, get the lower rate, wait until your first payment, pay down your mortgage to the original 20% down, get rid of the PMI. But this takes planning and execution. So if you go with a lender that was originally 1/4% better and turn that into 3/8% or 1/2% better, it nothing to sneeze at now.
Gus, Gus, Gus.....go talk to a lender. You don't mention your income or location, so I can't tell you if you qualify for various programs, but I can tell you who can. FTHB (first time homebuyer) programs are not only for the down payment, but the interest rate as well, some even offer a break in closing costs.
Look for a local correspondent lender or a community bank with a full menu or loan offerings. A loan officer can size up if you really should dump 20% down now.....do you have funds, after? If you go with PMI, your rate will be better (the loan level pricing adjustments - or how they calculate Fannie rates, a 90% or 95% loan always has a better rate than 80%). Then, there's a sneaky trick, if you take a loan plan with PMI, get the lower rate, wait until your first payment, pay down your mortgage to the original 20% down, get rid of the PMI. But this takes planning and execution. So if you go with a lender that was originally 1/4% better and turn that into 3/8% or 1/2% better, it nothing to sneeze at now.
Don't some lenders have a time requirement for removing PMI as well as the 20% equity (like you must make x number of payments on time)?
This is my first time purchasing a house, and getting confused and frustrated speaking with all of these mortgage people giving me different numbers and rates.
I would be putting 20% down and have 760+ credit
First I was recommended a mortgage broker, after working with him for a few days and providing the documentation he ends up quoting me 3.875% rate.
I wasn't satisfied with this rate so I went to Chase and got a rate quote of 3.675%. He told me that this mortgage broker also didn't disclose some normal fees such as the title insurance fee and he was right the broker didn't list that in the closing cost estimate. Chase offers a 'lender credit' but i dont know this sounds like a scam.
I'm thinking of shopping around more but every place I call wants to run my credit, I don't want to harm my credit score. Should I call these places and have them run my credit to get the score?
What about online banks like quickenloans or something like that? Does it affect the ability to get the mortgage and would their appraisers not know the local area and more likely to give a bad appraisal.
Any advice at this point would be appreciated...
90% of the time the seller pays the Title policy.
I just deleted a wall of text. Search this forum. Your questions have been posed many times.
Don't some lenders have a time requirement for removing PMI as well as the 20% equity (like you must make x number of payments on time)?
There are three paths to eliminating PMI. You are mixing two of those up.
The OP always has the option to pay down their mortgage to 80% of the original purchase price.
You are confusing the method where current value may be used, provided there is a satisfactory payment history, where the homeowner orders an appraisal.
This is my first time purchasing a house, and getting confused and frustrated speaking with all of these mortgage people giving me different numbers and rates.
I would be putting 20% down and have 760+ credit
First I was recommended a mortgage broker, after working with him for a few days and providing the documentation he ends up quoting me 3.875% rate.
I wasn't satisfied with this rate so I went to Chase and got a rate quote of 3.675%. He told me that this mortgage broker also didn't disclose some normal fees such as the title insurance fee and he was right the broker didn't list that in the closing cost estimate. Chase offers a 'lender credit' but i dont know this sounds like a scam.
I'm thinking of shopping around more but every place I call wants to run my credit, I don't want to harm my credit score. Should I call these places and have them run my credit to get the score?
What about online banks like quickenloans or something like that? Does it affect the ability to get the mortgage and would their appraisers not know the local area and more likely to give a bad appraisal.
Any advice at this point would be appreciated...
Today's rates are 3.54% and you might find lower.
You can ask for their rate without them running your credit. They won't be able to lock it in for you, but if you ask the first place where you applies for a copy of your credit report they are obligated to give it, don't know about the credit score.
As far as appraisals go they should send someone local who should know the area, but it's really based on comps and what they think the home is worth.
I would go with a local lender, which I did. I like the fact that I met this person in person, after that most everything was done via phone and email but still I knew where the office was if I did have to go and hand paperwork in.
Your credit should only be run when you request a preapproval.
You really only need one preapproval to look at houses, once you find a house that is when it's time to pick your lender. It could be months before you find a home you like. Your rate won't be locked with a preapproval so it can go up by the time you are ready to buy.
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