Here's the set up. You're shopping for the best interest rate. You're on-line and you see it. 1/2 to 3/4 points below anything you've seen or heard of. You're thinking "Bonanza" (not the t.v. show - for those of my generation) I'm really going to get a good deal. Now if you've ever listened to Clark Howard on the radio you hear these alarms going off - bells, whistles, sirens etc. That is exactly what should be happening at this point. Really cool things can happen but here is what you need to do.
#1 Get a written G.F.E. ( It still may be bogus ) This tells you what the costs are. Are you paying points? What is the processing Fee? Is there an Origination fee? It should even show you the "rebate" if any, that the originator is getting. Show it to someone that you trust that can explain it to you.
#2 Is the loan locked? Get something "In writing" that shows that the loan is locked. Preferably from the lender, not the Broker. If the loan isn't locked ask why? Is there some information the lender needs. A loan can be locked with a signed 1003 (loan application) and a 1008 (transmittal summary) with most lenders.
#3 Do you have an "approval" from the lender. Not from the Broker but the lender. Not a pre-qual letter but an approval. Get something in writing from the Broker that shows that you have been approved. If you can, get the letter from the lender that shows your approved. This shows that your Brokerage has submitted the loan and you are approved. The actual paperwork from the lender shows the % rate and the terms.. ie 30 yr. Fixed.
#4 After following these steps have you seen any changes in the figures... In the person you are dealing withs attitude... In the response times... etc? If your answer is yes to any of these then those sirens, bells and whistles should be going off again. And, my advice is to Run to the nearest exit - Do not pass go, do not collect $200
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