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For a fixed mortgage rate home loan, which one would you prefer: (all circumstance are the same, the rates are given out at the same time..)
1. your own credit union which your bank is at (more convenient when it comes to personal finance management), paying an Origination Fee of 0.5% at a 15 yr loan at 6.3750%, once you lock it, you can not change it unless you wait till the lock period expires and wait another 60 days to relock the lower rate, which is impossible due to the closing date for the purchased home.
2. Through mortgage broker with a higher Origination Fee of 1% at a bit lower rate of 15 yr I rate at 6.25%, could be with any mortgage lender, the broker will give me a chance to relock if the rate goes down by one percent before closing of the home with no extra charge. After 6 months, the broker will call if the I rate goes down significantly and there will be no Origination Fee charged, and only some 3rd party cost will be charged, but could run about $1800, not sure what this cost is for.
Which one would you prefer? I like the idea of choosing my own back over a mortgage lender which I’m not familiar with, it’s easier to keep track of our personal finance, but the mortgage broker seems to be able to provide more detailed service. A mortgage broker suppose to be able to select the lowest rate available, but seems like her rates aren’t much lower than what the credit union can provide. Also, the mortage broker already pulled my credit, I don't want to get pulled again by the credit union to reuin my credit (my credit is in excellent condition), I could be wrong, that’s why I’m trying to get some input here.
Agreed, check with another one or two lenders. The credit union typically has a great rate, not so hot w/ service and overall knowlege. They will do what is in the best interest of the membership, the membership of the credit union.
The only thing about the broker that raises my eyebrows is a promise of what someone will do in the future - kind of an empty promise to me. Who's to say they will even be in the business? Don't let that be the deciding factor. Maybe for his knowledge and education, but not an unenforceable promise.
Above all, trust your gut and don't be swayed. (And don't let anyone cause you to second guess yourself once you make your decision).
thanks for your input. it helps and I didn't even know about the credit pulls could be counted as one within 30 days..
how do I do a good comparison between the credit union and the independent mortgage broker? I mean, the credit union spits out the updated I rate twice a day when the broker gets the updated I rate every 5-10 min. the only thing I can compare the 2 is their origination fees…the I rate I quoted above is an estimate of the timing that I thought is the closest when in fact it could be wrong. I would never really know which party is a better I rate selection. Also, I heard a broker is good for people with no so good credit. We have excellent credit, above 800, and I heard it's better to go with our own bank in this case. that's why a broker charges a higher fee, they are there to find a loan for a no so good credit history buyer, am I correct?
also, can I use the copy of the credit report I have from the broker and give it to the credit union to get a good faith estimate, so I could save one credit pull? many thanks.
It's a fact that a bank charges btwn 1-1.25% higher than a broker.
Also, it would be HARDER for a broker to go out of business than a bank.
Brokers don't sell/buy loans so they dont need to worry about those losses. If one bank goest out of business...they sign up with another one.
Quote:
Originally Posted by hueimo
thanks for your input. it helps and I didn't even know about the credit pulls could be counted as one within 30 days..
how do I do a good comparison between the credit union and the independent mortgage broker? I mean, the credit union spits out the updated I rate twice a day when the broker gets the updated I rate every 5-10 min. the only thing I can compare the 2 is their origination fees…the I rate I quoted above is an estimate of the timing that I thought is the closest when in fact it could be wrong. I would never really know which party is a better I rate selection. Also, I heard a broker is good for people with no so good credit. We have excellent credit, above 800, and I heard it's better to go with our own bank in this case. that's why a broker charges a higher fee, they are there to find a loan for a no so good credit history buyer, am I correct?
also, can I use the copy of the credit report I have from the broker and give it to the credit union to get a good faith estimate, so I could save one credit pull? many thanks.
[quote=renriq02;5904555]It's a fact that a bank charges btwn 1-1.25% higher than a broker.
quote]
but the credit union is charging a Origination Fee of 0.5% while the broker is charging a 1%, unless there's other hidden fees you were referring to..thanks for the input
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