How many of you usually shop with those that have a better name or what we think, those who have a better brand name? I know I do. When I shop for clothes, I love shirts made by Polo. And yes, I generally pay for it in price, but I am also buying very good quality.
But what about it when it comes to you shopping for a mortgage? It doesn't matter if it's an FHA loan or a conventional loan, do you go for the best recognized name? Such names as Countrywide, Wells Fargo, Bank of America?
Here is the skinny of it. No matter how big nor small may that company be, we all get our money from the same place when all said and done. With that said, you should seek out a mortgage professional. One who is honest and ethical. By not doing so, could cost you thousands of dollars in the long run.
Here is why I decided to write about this. I received this from a consumer last night.
"I am in the process of purchasing a new condo from Taylor-Morrison. They told me if I used their lender then I would get 10k towards closing costs . I wanted an FHA loan and they told me they were in the process of getting their FHA approval. So I filled out an application form on the spot and got pre-approved, gave them a deposit of around $7500 and then set-up and appointment for the design center. On to the story, I had an appointment with a loan officer from Countrywide who is the builders lender and at the time rates were 5.87 I wanted to lock-in and she told me " my gut tells me that rates will drop in the week to come " and she thought that I should hold out. Well 2 days later rates went down to 5.75 I immediately called her then I get " you know since you're doing an FHA loan I don't think you would get that rate ". She told me she would look into the matter and get back to me. I email her about it and never got a response. Til about 2 weeks ago someone from the underwriter's office calls me asking about my 2007 taxes."
The story goes on to where he might now seek a lawyer to get out of this contract. But the main theme to this post is that you might not always deal with a true professional or one that has experience or knowledge, that works for a large lender. Those loan officers that you talk to at large mortgage companies that work in a centralized area or state, ie. call center, they are usually not experienced. And you also have to be careful of those lenders that are used by builders. You need to keep in mind that nothing is ever free in this business. They might credit you $10,000, but they are getting it from you one way or another. And by tacking on that amount to your purchase price, might cost you more money in the long run.
Lastly, always be careful of Red Flags !!!!!. This particular loan officer used the term, "gut feeling". Would you work with a stock broker, who was investing your money, and say, "I am going to go on a "gut feeling" and pick x,y,z stock"? I don't think so. So why would you want to work with a loan officer that uses the same term, when it comes to locking your rate in? Or giving you advice on what strategies that you should take when it comes to rates and mortgage programs. You want to speak to a professional loan officer that knows the market, knows the market indicators, knows how to read the market reports, and understands how the bonds work and the mortgage back securities. Advice? Seek someone with knowledge and expertise, and not just someone that can quote a rate.
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For more information on FHA loans, please go to this link. The FHA Expert
For more information on how you can obtain your dream home, please click here : Mortgage Financing Options
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!!
Copyright © 2008 by Jeff Belonger
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