Posted by Jim on April 11, 2001 at 04:08:02:
Your situation is not all uncommon. First, find out if your ‘lender’ is really a lender or mortgage broker. Second, look for local smaller lenders. They are geared to work with the local community and I find they have better programs for my ‘first time home buyers’ and refinances.
In short, GO SHOPPING! You don’t have to use the ‘lender’ your agent sets up. Remember, your agent works for YOU.
Mortgage lenders?? (help!) - Posted by Dan McDonald
Posted by Dan McDonald on April 10, 2001 at 22:25:03:
I need to ask the advice from you experts…
I am buying my first home (in Houston), but for myself and my wife, not for investment purposes. (That will come later.) Our real estate agent recommended a mortgage lender to us and we’ve been pretty much going on blind faith. We are currently about 3 weeks from closing and it seems that they might not have our best interests in mind. They say that due to our credit, we have to get an FHA loan and that this is good for us because we get a lower interest rate and we can have the seller pay the closing costs. It also seems that they are nothing more than an expensive middle-man, charging us 1% of the loan as their fee. They will then sell the loan to someone else. So we are still going to have to pay about $3,500 at closing, even though we’ve increased the cost of the house (and the loan) by $5,900 to repay the buyer for covering the closing costs.
I’m not sure what it is, but something about this situation just feels very wrong. Any advice on what it is, or what our best options are would be very appreciated!!!
Dan
Re: Mortgage lenders?? (help!) - Posted by dewCO
Posted by dewCO on April 11, 2001 at 15:43:20:
If it feels wrong shop around. WHAT exactly about your credit makes you need to go FHA. They should be telling you MORE. FHA interest rates aren’t lower than conventional. Maybe someone is paying points to buy down that interst rate, or they have you in an adjustable, to make it seem like the interest rate is lower. SHOP WITH OTHERS!
Re: Mortgage lenders?? (help!) - Posted by steph in tex
Posted by steph in tex on April 11, 2001 at 07:26:04:
I don’t agree with Jim below. (sorry Jim)
If you are just 3 weeks away from closing, you’ll probably miss your target date by shopping around. The services of a good broker are what you are paying for with that 1%, yes, but you wouldn’t expect someone to work for free right? They find you the best deal for your situation. Now, granted, all brokers are not created equal, and I’m not sure who it is you’re dealing with. But everyone in the industry makes their living from the borrowers to some extent. So you may find the samething somewhere else, or you may not pay points, but you will pay higher interest. See what I mean? If it is a personality thing, that may be another issue.
So with all that said, just keep in mind that you are on some time frames here. How is your relationship with the seller? Will you throw yourself past your contract date? Did the seller mind the FHA?( as Jonathan said, there are FHA alternatives)
If you do want to shop for a lender, work out an extension in your contract first. Even if you just buy yourself an extra week or two.
I think the peace of mind that you will have time to move your loan, get everything started again etc and won’t blow your contract, is very important.( if you are using a standard TREC contract, you have an extension of 15 days if you have lender approval, but if you can let the seller know up front that closing may take up some of that time, it will save you some heart ache) You just don’t want to spend a lot of time scrambling at the last minute. It makes for a poor experience, and sellers hate it too. Why do that to yourself? Do you already have another lender in mind? Is it someone you know and trust? If so, then you should have been there in the first place, and if not, you’re in the same boat as you are now.
Why not sit down with your current broker and see what you can work out? He’s just a guy with a job. He may be more willing that you think to work with you on these issues.
I’d give that a try before I’d pull my loan at the last minute. You might make it harder on yourself when you don’t have too. Are you willing to pay a little higher interest instead of points? Tell him that if you are. He should be able to find a program that works well for you, the client. Remember, it’s his job to do that for you, but you need to be clear with him though on what your needs are, so that he can serve you well. Those are just some thoughts. If I can help you at all, give me a call. I’m in Austin.
512-328-9677.
steph in tex
Re: Mortgage lenders?? (help!) - Posted by Jonathan Rexford
Posted by Jonathan Rexford on April 11, 2001 at 05:54:56:
FHA loan products…There are alternatives to FHA. If you are not comfortable with the loan product that you have selected through this lender/broker then request that your file be transfeered to another broker. BUT what ever you do! Do not go shopping and let every broker pull your credit. $3500 does not seen exceesive when it comes to FHA, of course it depends how much the seller is putting up. THe seller can pay up to 6% in closing costs or non recurring closing costs.
Good luck with your decision
Jonathan Rexford
1st Metropolitan Mortgage