Chuck's Mortage Blog

Keeping up with ever changing mortgage interest rates

Chuck Benedon (Lender Rate Match, LLC) — Wed, 12 Mar 2008 08:06:06 -0700

As you know, mortgage interest rates change many times, daily.

Lender Rate Match's widget lets you see what is happening to those interest rates on a moment to moment basis, and its FREE. You can see it here: http://www.freeratesearch.com/

You can even get the widget and put it on your website. Get the code here: http://www.lenderratematch.com/en/widgets/recentsearches/

The widget can allow you to see up to five recent search results.

Lender Rate Match will soon release two new products for the public and real estate pro sector, making this state of the art mortgage pricing technology available for anyone who wishes to use it. There will still be the FREE version, but there will be two other levels of pay models for those who want to use the exact tools with the exact reporting that bankers and mortgage brokers use.

The new products should be available within 30 days.

FREE WIDGET for real-time mortgage rate searches.

Chuck Benedon (Lender Rate Match, LLC) — Wed, 13 Feb 2008 10:43:35 -0800

SEE REAL RATES as they happen. A GREAT tool.

Our new widget shows the results of searches conducted on our website, by individual users. The actual qualified rate appears with the Score, LTV and loan amount, loan purpose and various loan types WITH REAL-LIVE up to the minute rates.

You can put the widget on your site by going here: http://www.lenderratematch.com/en/widgets/recentsearches/

You or your clients can pre-qualify themselves here. No more guessing and waiting to see if you qualify for the home purchase or refinance you need.

This technology is what everyone talks about, but we DO it.

Chuck

http://www.lenderratematch.com

The widget is right on the home page.

REAL TIME MORTGAGE PRICING WIDGET

Chuck Benedon (Lender Rate Match, LLC) — Tue, 12 Feb 2008 11:17:01 -0800

GOOD MORNING ACTIVE RAIN.

We released our long-awaited mortgage pricing widget. Rather than explain it, here is a picture of it.

You can log to our site and grab it there to put the code onto your site. It is a GREAT tool for you and your customer. If you want, you can click thru to our site where you can register and search to your hearts content for your very own personal pre-qual pricing that displays the BROKER'S PAR (cost) RATE !!! Now, all you have to do is compare closing costs. We DO connect them to ONE lender in our network if they want to use the system. NO PRESSURE.

3 simple steps and the whole process only takes about 2 minutes.

1) Enter Data (Register)

2) Get Rates

3) Compare Closing Costs

Wisconsin Legislature Targets Trigger Leads

Chuck Benedon (Lender Rate Match, LLC) — Mon, 22 Oct 2007 14:03:23 -0700

Legislation Targets Trigger Leads

In case you are unfamiliar with the term, a trigger lead contains data regarding financial information about a person who has applied for credit that is supplied to a third party who is not part of the initial transaction. In the mortgage industry, it specifically refers to information that is sold as leads by the three largest credit agencies (more commonly referred to as "the bureaus") TransUnion, Experian and Equifax.

Wisconsin Department of Financial Institutions Steps In

The Wisconsin Department of Agriculture and Consumer Affairs, supported by the Department of Financial Institutions support this bill, which is intended to protect consumers from the confusion and inconvenience caused by these trigger leads. Companies who deal in leads and violate the new rules will find themselves paying fines to the State of Wisconsin. Catherine Haberland, head of legislative affairs for the Wisconsin DFI, testified before the legislature on October 4^th. She said "DFI believes our laws should protect a consumer's privacy - a person should be able to walk into a bank or credit union and apply for a loan without a third party selling the details of that transaction to other lenders. " I couldn't agree more, and I have the feeling that all consumers and most loan originators will also welcome the new laws.

Loan Originators Get Compromised by the Bureaus

Imagine being a loan originator, with a hard earned referral in hand, paying an agency about $15-$18 to get the clients' credit report and then the company you paid to pull the credit told your competitors what you were doing and with whom and sells the information for pennies?? A mortgage broker told me, last week, that he pays a meager thirty cents each for trigger leads.

Then, the clients' phone starts to ring at any hour of the day, any day of the week, in quantities that become an absolute annoyance to the point of souring a possible client on the whole process. This type of nuisance calling gives the entire mortgage broker industry a bad taste for almost anyone who has ever experienced this. I have even heard the loan officer getting blamed, because the client has no idea where else these calls would have originated, since they only applied at that one trusted source.

On top of that, it seems like a conflict of interest for the credit bureaus to expose the personal information of people whose credit they are charged with protecting, without permission from that person. There are ways for the consumer to opt out of this practice. It is like getting yourself onto a "do not call" list.

How to opt out of trigger leads

Assuming you don't want your personal data to be sold, there are two ways to opt-out of trigger lead programs. First and easiest way is to fill out the online form at http://www.optoutprescreen.com/. This will stop trigger leads for five years. The other way, which will stop trigger PERMANENTLY, is to print the available form, complete it, and mail a letter generated by that form to confirm your request. It takes five days for the request to become active, so if you are planning on applying for credit, do it five or more days in advance of applying.

Here is a link to the Wisconsin Legislation; http://www.legis.state.wi.us/2007/data/AB-502.pdf

One website that is doing something about this is Lender Rate Match. (http://www.lenderratematch.com/) This site allows the consumer, to pull their own credit while shopping for a mortgage. When a consumer pulls their own credit, NO trigger leads are created. Additionally, this website scans their databases of numerous lenders, finds the one with the lowest rate, and connects the consumer to a lender who will supply that rate. The rates that are displayed there are the broker "par" rates, the same rates the broker pays, thereby leveling the playing field for the borrowers. So, the consumer only has to find and compare the actual closing costs and fees involved, based on the broker's rate.

New Patent Pending Mortgage Technology Helps Home Buyers and Agents

Chuck Benedon (Lender Rate Match, LLC) — Thu, 18 Oct 2007 14:49:05 -0700

Using New Patent Pending Mortgage Technology to Help Home Buyers

(A must read if you really want to help your clients)

Wouldn't it be nice for homebuyers if all they had to do were to compare closing costs and rates were more transparent? Read on.

In this day and age, with loan programs constantly changing and the uncertainty in the market, finding the best loan product can be a daunting task. Getting a potential homebuyer pre-qualified can be difficult as well.

How can you determine your best chances, or at least get a good leg up on this process? Buyers need to know how much home they can afford and typical mortgage calculators don't do the trick. These generic mortgage calculators can't do much more than take a guess at what you MIGHT be able to spend. They can't consider the buyers credit score, a critical component to any application. They can't consider various programs or take into consideration the buyer/refinancing borrowers' debt ratio.

So, normally, a realty sales person will contact a loan officer of sorts, whether from within the office or an outside source. One problem with using inside sources is that it can constitute a conflict of interest, not so much in a legal sense, but more nepotistic-like. Who are you supposed to be helping; the lender that your realty company owns or is owned by, or the customer/client? Even an outside lending institution can't always know where to find the best rates and programs.

Data from Lender Rate Match, LLC show that in MOST instances, home buyers and refinancers were eligible for fixed rate loans but wound up with adjustables, anyway. How did that happen and how can it be avoided in the future? To understand this, you have to have some background in the mortgage industry. As a former mortgage banker, I NEVER wrote a ‘stated' loan and if a client could qualify for a fixed rate, that is where I put them. I rarely even wrote adjustables.

One of the reasons we have the mortgage finance meltdown today is because loan originators of all kinds were either too lazy to bother checking enough of, and in many instances simply overwhelmed by, the myriad of loan products that were available and not able to vet them properly. In other cases, they had tools available to them, but were too cheap to pay for them. Some subprime mortgage pricing and eligibility engines were and are still available for as little as $30 a month, like LoanRunner. (http://www.loanrunner.us/)

Another, more subtle factor is the "self-foolfilling factor". I cannot tell you how many times I have heard loan officers tout that they "know where to get the best rate". Simply "knowing where to get the best rate" is a self-fooling factor. How can any loan officer simply know that? I can show you so many variables and different rates for only one scenario, your mind would bend. How the loan officer gets fooled into believing this can best be explained thru a scenario walk-thru. Here is a typical process that takes place when the loan officer gets a lead.

They contact the buyer/refinancer. The buyer asks, "What are your rates?" Anyone who has ever worked that industry for more then 6 hours knows that rates can't be simply quoted like that, as you would need much more information (like credit scores, income, loan to value, etc) to know that. So, the LO says, "I will check and find you the best rate, that is my job. Hang on." He/she walks to the bulletin board, pulls down a sheet from a company that had a good rate the last time they financed someone and uses that to quote from. But, that company may not have the best rate at this time, because of changes in the marketplace and how and where they securitize and how they scrutinize that type of borrower. Especially in subprime, most lenders have niches they sell. So, if a loan officer had a high loan to value loan with a low score and found a good price with one company, the next loan that comes in might be a higher score with a lower LTV and this is where many, if not most of the LOs, succumbing to the self-foolfilling factor would think that the first company, having such a good rate on that lousy borrower, would certainly have the best rate for a better client. WRONG. It doesn't work like that. The poor client is now getting the wrong loan.

My consumer site, LenderRateMatch, does that vetting for the client and can help avoid getting the wrong loan. You can see a demo of how it works, here. (http://www.freeratesearch.com/en/demo)

Of course, I want traffic to my site, but when you see what it is all about, you will see that the underlying premise is to help the borrower by scanning dozens of lenders' programs, finding the lowest rate in the database and showing them the broker par rates, thereby leveling the playing field so all they have to do is compare closing costs.

During the 2-3 minute process, we check the debt ratio, we consider the credit score, the loan to value and other factors that let the client and the real estate pro know what this buyer can really afford. That whole part of the site is like a big mortgage calculator.

FHA Secure's High Expectations "Wildly" Optimistic

Chuck Benedon (Lender Rate Match, LLC) — Tue, 25 Sep 2007 14:18:27 -0700

Government estimates that the FHASecure program will rescue as many as half of all consumers going into the foreclosure over the next two years are wildly optimistic, reports Lender Rate Match owners of the FreeRateSearch.com mortgage search engine for borrowers. Though details of the FHA program are not yet available, it is likely many property owners will not be able to use FHASecure to refinance, including:

Loan Limits are too small to be helpful in higher cost areas of the country. Congress should raise these loan limits as requested in the FHA modernization proposal. Even then, however, this program won't meet the needs of homeowners in very high cost areas like California.

Equity of at least three percent may be too steep for borrowers who bought their home with little or no money down - before house prices declined. Consumers who are "upside down" and owe more than their home can appraise for will be unable to take advantage of FHA loan program, or any loan program.

Credit standards are likely to be too difficult for many subprime borrowers to meet. Approximately 2.5 million subprime loan interest rates are resetting this year and next. By definition, though, most subprime borrowers are those who have poor credit histories. It is unlikely that their credit problems have disappeared since they obtained their mortgages.

Demonstrating stable employment and income will be a problem for many homeowners who either obtained a "stated income" loan, where they were allowed to list income without verification, or lost their jobs recently. Some 88,000 jobs have been lost this year in the financial sector alone. Self-employed borrowers may also have a difficult time meeting employment verification requirements.

Risk-based mortgage insurance premiums (MIP) can add significantly to the monthly cost. The cost of MIP was one reason why FHA has been dropping in popularity over recent years. Instead, homebuyers have turned to conventional "combo" loans, which combine a first and second mortgage to avoid MIP or private mortgage insurance (PMI).

Investors and second home owners are also unable to use the program to get out of expensive loans. In some areas of the country, such as Florida and Nevada, the high numbers of defaults are linked to a large number of investor loans. While these foreclosures will not result in homeowners losing the roof over their head, they will still serve to drive down home prices and make it more difficult for individuals trying to sell their homes to do so.

Lender Rate Match data show that risky adjustable rate mortgages were not necessary for most subprime borrowers who obtained them in the past two years. Because consumers have not been able to compare subprime loans themselves, they were easily steered into loans that were better for the lender than the borrower. Now, they can.

Gerri Detweiler, consumer advocate and Education Director for FreeRateSearch.com recommends that, in addition to learning about the FHASecure program, home loan shoppers also use the FreeRateSearch.com search engine for mortgages. It allows consumers to search available loans, subprime to prime, and receive an instant quote. Borrowers are also matched with a single lender who can help them obtain that loan. They can compare the results of the search engine with loans available from an FHA lender.

"For some homeowners, the FHASecure program will be a godsend. But for many, it will offer no relief," says Detweiler. "It's clear that, going forward, consumers need to shop aggressively for their next loan and not blindly look at FHASecure, or any other loan program, as their only option."

MORTGAGE RATES QUOTES

Chuck Benedon (Lender Rate Match, LLC) — Fri, 14 Sep 2007 14:34:33 -0700

Every day we talk to borrowers and potential home buyers about mortgage rates. Thousands of them use our website (http://www.freeratesearch.com) to find out what programs and rates are available to them, if they can pass the underwriting process.

One of the biggest problems we hear about is the misquotation of rates and the baiting of people to do business with a particular broker. Brokers provide a viable function in that they are able to quote the rates of many lenders, wherein a direct lender can only quote you from their own program rates. Our system gets the rates from the national lenders and puts the borrower in touch with a lender who can provide that rate, which is the lowest rate found in our huge database of lenders and programs.

Our lenders know that we show the broker par rate to the borrower and they are willing to match that par rate. The par rate, as most of you know, is the cost of money to the broker with no costs or fees. This makes it much easier for the borrower to compare. First, you have the rate. From there, the borrower can compare GOOD FAITH ESTIMATES (GFE) from any number of lending institutions, whether direct lenders or brokers. That is the bottom line in determining which loan has the lowest cost. Determining the best loan products is a question that needs to be discussed with the lender. Too many people have found out the hard way that the lowest rate may not be the best loan product.

Now, to make my point about quotes. Our site generates revenue by selling leads. No great shakes there.. except for a few things. We only give the borrowers information to ONE single lender. Because the borrower sees the par rate, it is only necessary that the borrower compares the GFEs. One lender we spoke to who buys leads from the "big guys" as he put it.. ( you know who they are ) told me that our leads wouldn't work for him. I asked why. He told me that he didn't like the idea that we told the customer the real price because he likes to make his own price by quoting UNDER PAR so he can sound cheap as he competes with "up to four" lenders. If you are quoting BELOW PAR, the borrower pays for that and can no longer compare the GFE. I think that some lenders like that because it confuses the borrower. In fact, in the mortgage industry, most pricing engine companies tell the loan officers that that the best part of comparing multiple lenders at once is so they can MAKE MORE MONEY on the borrower.. WHAT? When I was a loan originator, I thought my job was to look out for the best interest of my client.

Therein lies part of the reason that there are so many foreclosures, right now and more coming. Had loan officers used pricing tools like our company has offered under the Loanrunner.us banner for the last 4 years, they would have seen that almost all of the people who they sold ARMs to, could have qualified for fixed rate loans.

Register at our site. It is free. From there, you can find out what the par pricing is. If you are being quoted below the par rate, double check. That is part of what our site is for. Feel free to contact me here or by using our contact from on the site.

Places where we have been cited: USA Today, NY Times, Kiplinger's, Bloomberg, CNN, TerrySavage.com, MSN Money and more.

MORTGAGE RATES - REFINANCING and NEW PURCHASES

Chuck Benedon (Lender Rate Match, LLC) — Fri, 29 Jun 2007 07:53:34 -0700

Whether your client is looking to finance a purchase or to re-finance a currently owned property, it is the borrowers' credit worthiness that makes or breaks the deal. The house is only important where it relates to the likings of the clients. The appraisal is based on data that cannot be "controlled".

So, the question facing the real estate pros or the client is; "Can I/they afford this payment and the risk it may possess?"

People qualify with adjustable rate mortgages for many reasons. Some realistic, some not. I have been involved in banking for some time, and for the last five years I have been involved with mortgage pricing technology. My company is the first company to supply a universal mortgage pricing and eligibility factoring product to the mortgage industry and is the premier non-prime pricing/eligibility tool in the country. While that is not fully pertinent to this blog, what is pertinent is that we also have quality data regarding adjustable rate mortgages as they compare to fixed rate loans.
** (I will discuss more about this, momentarily)

When a client comes to you, as a real estate pro, you need to know if the client can afford the property they want you to show to them. If they want to see a $400,000 home, it is important that they can afford it or you will all be wasting your time. A common initial question posed to the buyer is "Have you been pre-qualified?" That can be a complex issue. What is a pre-qualification and how good is it?

I would like to make it clear that pre-qualification does NOT guarantee that a borrower will definitely get that mortgage loan. It simply means they have passed a certain level of muster and must now prove their eligibility through the presentation of documents to prove their credit worthiness. The approval only comes after ALL of the information is consolidated and vetted and the lender gives their approval "clear to close" documents.

Our current mortgage technology (http://www.freeratesearch.com) is state of the art and there is no other place on the Internet where you can get complete mortgage loan pricing, fully vetted for ANY credit type. Our software will tell you whether or not your customer will qualify for a particular loan. You CANNOT get customized pricing anywhere else on the web. People think that mortgage prices are found everywhere and when I tell people what I do, they say "Well, aren't there mortgage rate pricing sites all over the place?" Fact is, there are. But the prices you see do NOT relate to your borrower. They are nebulous and generic and almost never give non-prime rates. Prime rates vary only a little bit.. for the most part, about 1/8 of a point either way. Alt-a and non-prime can vary almost 2 full points from best to worst comparing identical loan types. That is why it is so important to use technology like ours to find the best rates, not just the best rate the loan officer THINKS they know about. A lender who has the best 2 year adjustable for a high Loan to Value-Low Score combination, is probably NOT the lender with the best 30 year fixed for the Medium LTV-higher score combo.

Our system will determine the BEST loan a person can get, whether it is prime, non-prime or in between (Alt-a). It determines this by using the data that loan officers would use to pre-qual a client, and more, but does it much more efficiently and quickly. But, more important, we check the data of DOZENS of lenders, all at once, and return the results instantly. No loan officer in the world can check that many, accurately in any time frame. So, when a loan officer pre-quals a client, how do they know they have even found the best rate?

**Our data shows that when checking the borrowers' criteria across the board against numerous lenders that adjustable rate mortgages are not needed in almost every case. This is particularly poignant with non-prime borrowers. In fact, loan officers who use our wholesale tool can see that the best 30 year fixed loan is better than MOST of the 2 year adjustable rate mortgages. So, why would anyone find themselves with an adjustable rate mortgage in the first place? Because the loan officer didn't know where to find the BEST 30 year fixed.

You can get more deals done by using our tool. Rates are updated multiple times, daily.

http://www.FreeRateSearch.com

Find the BEST Mortgage Rates.. How to do that.

Chuck Benedon (Lender Rate Match, LLC) — Thu, 31 May 2007 09:34:42 -0700

Every day we see advice from real estate and mortgage people with good intentions, telling their clients to shop around for a mortgage. They discuss how important it is, and it is, without a doubt, very important.

While all of that advice is "well and good", the inherent problem in "shopping around", still remains; How do you know if the people you are shopping with have the ability to, or will bother to find the "best" mortgage and rates? For years, there have been great technology tools to do that, yet most originators do NOT use those technologies to find rates. Many of them just wait for the next Lender Account Rep to walk in the door, get a quote and give it to the customer. That is not the originators job.... their job is to truly SHOP the rate for the consumer who doesn't have access. Certainly, it is more difficult in the subprime market than in conforming, where rates don't vary nearly as much.

Our site levels the playing field.

As a real estate agent you can use our system, which employs the best technology available, to find the best PAR rates for all types of loans in a database of dozens of lenders. You can find out if a client qualifies for the home they are looking for, within 2 minutes! Of course, Murphy's Law applies. If there is a better price, and we don't have it in our database, we won't see it. Consider how long it would take a loan originator to price dozens of lenders. Want to wait three months for the quote???

Our database has National lenders, not local correspondents or resellers. Chase, Wells, Taylor-Bean, Option One, Deutschebanc, BNC Mortgage, Bear-Stearns, Countrywide and many, many more are among the types of lenders' rates we scan. This process is so fast, we had considered slowing it down because we feared people woudn't beleive it could be so fast. But, it is. Our technology coders are the best.

Do yourself and your clients a favor. Use our FREE tool. http://www.FreeRateSearch.com and spread the word. With all of the ARMs resetting, this tool will help people stay away from adjustables. Our data shows that the difference between the best ARM and best 30 Fixed is not that great, and better yet (or worse...lol) our data shows that the worst ARM gets beat to death by the best 30 year fixed. (using same qualifying data) But, you have to know where to get it.

New Mortgage Data Released : Press Release

Chuck Benedon (Lender Rate Match, LLC) — Thu, 31 May 2007 08:54:21 -0700

First, that guy you see (my avatar) pulling at his hair is NOT me! He represents the borrower/home buyer/Real Estate agent who is freaking out over the confusion of trying to find the best mortgage for themselves or their clients.

Our Site: http://www.FreeRateSearch.com

The Release: http://www.prweb.com/releases/2007/05/prweb529620.htm

Our site eliminates the frustration involved in this process. It is FREE.

Typically, today's lead generators/aggregators sell the applicants' information to NUMEROUS parties and is the most often complained about procedure in online mortgage shopping by lenders and consumers, alike.

We eliminate that dilution because we don't need to have "banks compete" and confuse the process. We search for the lowest rates by scanning dozens of lender rates (1000's of combinations of programs) in our database, in seconds! We eliminate nuisance phone calls to the borrower because we put them in touch (at THEIR discretion) with only ONE lender who will match the lowest rate found in our database.

You may suggest your buyer/borrower pull their own tri-merge credit from our site, which comes from myFICO. (they pay myFICO) You get real fico (mortgage) scores and the BIG thing is; NO TRIGGER LEADS are generated. Imagine being a loan officer sitting with a referral, you pull the guy's credit and the next day they get 15 calls from people they don't know or even want to talk to. What ever happened to the "do not call list"?

In any event, check out our press release from this morning, regarding the minor difference in the rates when comparing a 2 year ARM against a 30 year FIXED. You may be surprised. http://www.prweb.com/releases/2007/05/prweb529620.htm

This is where people get stymied. No Loan Officer can vet out the data of dozens of lenders in short order. We can. If the loan officer doesn't know, or doesn't check to find where that "best" loan is, the customer suffers. Have a great day!!!

PS: We have been mentioned in/on: USA Today, CNN, NY Times, TerrySavage.com, and more.

SHOP DOZENS OF LENDERS IN TWO MINUTES - New Technology

Chuck Benedon (Lender Rate Match, LLC) — Fri, 18 May 2007 09:49:29 -0700

Talk about saving time!

Why bother waiting for a response from lenders when you don't have to? Now, you can pre-qualify your clients in moments, ensuring the best rates, derived from dozens of National banks.

Today's current online mortgage model requires people to give up their name and contact information just to talk to lenders to get a "Quote". Not a rate, but a quote. People think they will get "instant rates" only to be let down with the typical "Five lenders will be calling you with quotes" routine. When people are baited to give up this information, their phone rings off the hook. Their credit is pulled which triggers the Credit "Bureaus" (Trans Union, Experian and Equifax) to sell that personal information to anyone who wants it, causing the phone to ring off the wall for months, even after the sale is over. That information is sold over and over and over.

Our model is FREE and displays LIVE REAL TIME RATES for any credit type and shows numerous rates and loan types your client qualifies for. No more harrassing phone calls. No more confusing "quotes" from a myriad of sources. Now, you get to see the real broker rates. IF the client wants to connect to a lender, we allow them to connect to ONE lender. That's it. We do NOT sell this information over and over, diluting its value and causing anxiety in for the client.

Sound too good to be true? We know. But, we spent 4 years and a lot of money to get it done. Our engine technology has been used by banks and mortgage companies for years. You can find it and use it FREE, right now, right here:

http://www.FreeRateSearch.com

only takes about 2 minutes.

STOP WASTING TIME WITH UNQUALIFIED BUYERS

Chuck Benedon (Lender Rate Match, LLC) — Mon, 30 Apr 2007 15:53:19 -0700

Use our FREE pre-qualification tool. NO PERSONAL INFO NEEDED.

Used by mortgage professionals for years, now available to anyone who wants to use it, for FREE.

You'll never have to wait for the client to get qualified, again. Just log on (no account needed), put in the data and in seconds, we will show you the lowest rates from our extensive database of lenders for various loan types. We calculate their debt ratio to make sure they qualify.

http://www.FreeRateSearch.com

Chuck