Getting an Accurate Mortgage
Quote
When people shop for a mortgage quote, they often go about it backwards or let
themselves get derailed from their purpose. If you are getting mortgage quotes,
you obviously do not have a mortgage professional that you trust to call. Getting
an accurate quote is just one step to getting a great deal.
Remember that the number one objective in mortgage shopping is to find someone
you can trust, the second objective is to make sure that the loan program you
actually sign for is the program that is right for you. As long as these first
2 steps are done, chances are the 3rd step of getting the accurate quote will
fall in place.
I have put together a list of things that you need to have ready and a list
of questions to ask in order to get an accurate mortgage quote and to make sure
that you are comparing apples to apples.
Remember that it is the total package that makes up a mortgage quote. The rate
plus the costs that you pay when you get to the closing table. One company may
have a better rate, yet the costs are higher and vice-versa.
Since many people are so focused on the interst rate, the closing costs is where
you will notice the differences, so make sure you ask the questions in the closing
cost section of this page!
Some of the people you call will forget to include a certain item, some companies
intentionally leave out some items to appear cheaper. Especially in the arena
of closing costs. because the definition of "Closing Costs" is very
loosely defined. As I said, many exclusions are unintentional because the person
on the phone is just an order taker. Yet, that does not make any difference
to you once you get to the closing table and have to write a check!
Help them remember, appear knowledgeable and you will not only get a more accurate
quote but just might get a better deal when they believe they are talking to
someone who knows his stuff about mortgages!
Information you need to have ready
If you really want to get an accurate quote when you call, be ready with the
particulars for your situation for each of these items or ready to ask this
question. Do not change the answers to thes questions from lender to lender!
Some will try to change your answers to appear to have a better deal!
You can always change later if this really will be better for you, but right
now you are just trying to compare. Let them know that! "Oh, that's a good
idea. I may do that, but could you quote me with this answer to the question
so that I can compare?"
For a refinance
Your Loan Amount
The length of your Loan (10, 15, 20 or 30 years)
What type of Loan? (A fixed rate, an ARM, etc.)
Will you pay points?
What is the value of the home?
How much are the taxes? (Summer, Winter, Quarterly, etc.)
Do you want escrows?
Are you locking in the rate?
If you have this information ready, you can save having too many inquiries
on your credit report!
(This is just for a quote, to make an application, you will need to give out
the info necessary. This is important, they do not need to pull a credit report
ot give a quote! If they insist, then move on)
How would you rate your credit? (Be Honest here!)
Your annual income
Your monthly debts
For Purchasing a home
What is the price of the house?
How much is your downpayment?
When do you expect to close?
The length of your Loan (10, 15, 20 or 30 years)
What type of Loan? (A fixed rate, an ARM, etc.)
Will you pay points?
What is the value of the home?
How much are the taxes? (Summer, Winter, Quarterly, etc.)
Do you want escrows?
Do you want to lock in the rate now?
Closing Costs
Lower Closing Costs
will equal a higher rate. Don't let anyone fool you.
If there is not a higher rate or if there are not higher costs with a lower
rate, then they forgot to include something or they just have lower overhead
and are paying it for you.
There may be an acceptable answer to where the costs have gone, such as "We
include that cost here" but if you ask the following questions you will
know up front AND most importantly, if something changes later, you will know
that you already asked about it.
Many of the banks or brokers commonly do not charge certain costs in order to
appear less expensive than others for the people who shop for costs rather than
rate. There is nothing wrong with having these included as long as you know
it and they do not mysteriously appear later!
Questions to ask to ensure you are comparing apples to apples when it
comes to closing costs are:
Does this include all 3rd party fees?
If so, which ones? this should be
bank fees - either
a lum sum or detailed breakdown
title insurance
closing fee
appraisal
Does this include an origination fee?
Is there an origination fee?
Is there an application fee?
If so, Is this application fee applied against my closing costs?
Either, Does this inlude my escrows?
Or, Is there an Escrow Waiver fee?
Summary
Be ready to take some time to cover the aspects of your situation in order to
get an accurate quote.
With so many different items that can change your mortgage rate, it makes it
very hard for a banker to qoute you an accurate rate when you call up and say
"What's your rate?"
If you only ask the rate question you are setting yourself up to be surprised
later on!
Once you have asked all the right questions, you will have an accurate quote
and be able to go to the right place.
DailyInterest.com
is brought to you courtesy of Scott Campbell of
30800
Telegraph Rd, Suite 1801
Bingham Farms, MI 48025
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