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And the lender has to give you a written document with all the terms and the APR so you will know what you are getting and going to pay. They can't change it at closing. But nice try.
I've already posted the archived info that clearly spells out the many situations that result in lenders presenting a loan at closing that is DIFFERENT THEN THE ESTIMATE. There is NO RECOURSE and the buyer must either decide to reject the loan and kill the deal, suffering the consequences as spelled out in the contract they have with the seller OR pay the higher the costs AND THEN ON THEIR OWN file complaints with regulatory agencies.
Here is is all spelled out:
The way to MINIMIZE the risk of this sort of nightmare is to start the process with a trustworthy mortgage broker that is experienced and knows which lenders give reliable estimates vs those that are notoriously unreliable.
The main reason I wanted to avoid a mortgage broker was to avoid having to pay their fees.
Shop!
No money is "free," but all lenders have to disclose to you the cost of their money, and the costs of doing business with them.
Commercial Banks tend to be most expensive and most cumbersome.
Mortgage bankers and mortgage brokers tend to be less expensive.
Can you join a credit union?
Some are very competitive.
Simply going on "Bankrate" and comparing fees/APR is a novel thought, BUT each individuals qualify characteristics are different and mortgages are not a cookie cutter type of financing. You will have to do some due diligence on your part to see who works best for you. If you are looking for a race to the bottom as far as rates and fees - thats exactly what you will get with your experience / actually closing the deal on time / and providing the best possible options to you.
As far as fees - on your Loan Estimate - the lender fees are in section A. There are lender fees and/or origination points. Origination points can be a lender fee or it can be a fee directly associated with the interest rate you chose. (buying down a rate) the other costs are in the form of title, appraisal, prepaids, escrows, govt fees (if you have questions on these let me know)
Where to start? Definitely ask your Realtor for a Mortgage professional - anyone can post anything online to make them look good - I would want someone that my Realtor had experience with.
Rates - you have options - you can chose a lower rate which might add to your closing costs or you can choose a higher rate which would help you decrease your closing costs - rates now are in the 4-5% ranges.
Hope this helps (and yes I am a mortgage loan officer - just trying to help out
Quote:
Originally Posted by meshuggah
Hey everyone. My wife and I are going to get pre-approved for a mortgage as part of our house hunt in Los Angeles, and we're shopping around for a mortgage.
To those of you that have done this recently, can you offer your advice/experience in searching for a lender to provide the best rates?
Both of us have excellent credit scores (780+), and are not members of a credit union. We'd also like to avoid using a mortgage broker.
What kind of rates are real people getting right now? 4.5% ish? We will not be putting 20% down.
Also, how can I go about actually shopping them? Do I need to go through the complete 'pre-approval' process for each lender in order to determine the actual rate I will get? Or just pick one, do the complete pre-approval, and then simply contact the others and give them our credit scores, and see what they offer?
Going with your realtor's inspector, lender, etc is as dumb as buying a diamond from somebody's brother in law. My friend was under contract to buy a house (the same realtor who has my overpriced by 25% house listing btw) and she wanted my friend to use her inspector. She said no and used her own. The house, which had been under contract and fallen out twice before, had had the weep holes covered up and the inspector said RUN and they did. The house was only one year old.
Mortgage brokers do not charge the borrower any fee. Mortgage brokers are compensated in a wide variety of ways but ultimately there earnings are a function of how many loans close. This is EXACTLY the same method by which loan originators who work for a specific lender are compensated! The biggest reason there are multiple 'channels' of loan origination is that works for the lenders -- they generally OVERBUILD the systems needed to handle the loan process and rely on multiple channels to keep the pipeline working. For lenders that have "no human needed" or some call center staffed with near minimum wage workers they do not reduce the percentage of overhead that they charge but instead use that money not for compensation but ADVERTISING!
The further FACT is that bankrate or any other site is merely ADVERTISING the rates that MIGHT be available. The rate is NEVER finalized until you accept the loan AT CLOSING. In fact the various fees that are part of any estimate all have a wide range of factors that are legally acceptable reasons for changes at closing -- https://webcache.googleusercontent.c...&hl=en&ct=clnk
The difference between crummy loan origination organizations and those that are reliable and recommended by preofessionals involved in the home buying / selling process really comes down to responsiveness and reliability. Any lying goofball can buy an ad on bankrate or similar sites with rates that they are unable to deliver. The simple math of how many ignorant people will accept these lies and then be left in a panic at the closing table with a much more costly loan or worse no loan at all explains how naive people are roped in.
In the US any firm can include whatever words it wants in its name / branding -- there is no real difference in how much a 'guarantee' or with how much 'speed' any loan origination firm will operate.
By choosing to use an experienced mortgage broker who has given good service to family, friends, co-workers, and comes recommended by other real estate professionals you will greatly enhance the probability of everything going smoothly.
Exactly I am totally agree with Chet everett...
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