It is amazing how long Interest Rates on most loan programs have remained under 4%. This week even the Interest Rates on Conventional Loan Programs dipped below 4% with no Points.
I Know that we have been hearing for a while now Interest Rates being quoted under 4%, but what many Lenders some times conceal are the Points that are associated with the Interest Rate. Even with the strict advertising rules that Lenders have to abide by, Lenders, especially Internet Lenders, continue to find ways to not reveal the true cost associated with their Interest Rate.
Interest Rate shoppers need to be very careful not to fall into the trap of just looking at who has the lowest Interest Rate. Some times the lowest Interest Rate is not the cheapest rate. When shopping to see who has the best deal, Borrowers need to also look at the Lender's costs associated with the Loan. The quickest way to do that is to ask each Lender for what their cost is in box "A" of the Good Faith Estimate (GFE), and to also ask for what the APR will be on the Truth-In-Lending (TIL) Statement. Most Lenders will not give a GFE prior to doing a loan, but there is no reason why they can't verbally state what their fee is in box "A" of the GFE. If they will not do that, then Borrower Beware.
Another document that Borrowers can ask for when shopping for who has the best deal, is to as for a "Fee Worksheet" . A Fee Worksheet is what the old GFE use to be, and actually breaks down the Closing Cost better then the GFE does. If a Lender will not give you a Fee Worksheet then once again Borrower Beware.
However, Interest Rates and Closing Costs should not be the only reasons in choosing a Lender. Borrowers need to look at the Service, Availability, and Knowledge of the Loan Officer that they are dealing with. Shopping for a mortgage is like most anything else that you shop for, "You Get What You Pay For".
Interest Rates Be Careful Of The Costs!!!
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Info about the author:
George Souto is a Loan Officer who can assist you with all your FHA, CHFA, and Conventional mortgage needs in Connecticut. George resides in Middlesex County which includes Middletown, Middlefield, Durham, Cromwell, Portland, Higganum, Haddam, East Haddam, Chester, Deep River, and Essex. George can be contacted at (860) 573-1308 or gsouto@mccuemortgage.com
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