If this were a perfect world, every loan agent would be honest as the day is long. I would simply pick up the phone and dial the number my finger landed on in the phone book. Loan Officers/Agents, are driven by their boss, the broker, their own bills and the bank to profit as much possible from the transaction of your loan. So when you end up spending your child's tuition on mortgage payments, you'll be wishing you had done more homework.
NOTE:
Before I begin a diatribe of the evils of the mortgage industry, I would like to say that I do not hold it to be true that all loan officers are inherently evil. Should this have been a fact I would not have remained where I am today in home loans field, for the last 3 years.
There many variables to creating a loan for each individual and their home. The largest investment 95% of most Americans will make, deserves careful consideration. Deciding to go with the first loan agent you happen to talk to is inconsiderate, to you and your families future.
Less paperwork and more personal attention means you enter a “frustration-free zone” from application to decision. With that in mind, reserve your frustration for more important matters when it comes to giving your loan agent as much information as possible when shopping for a good faith estimate. The less information you are willing to divulge to a qualified Loan Agent, the greater chance of the quote you were given over the phone changing by the time you reach his or her office.
Here is the information any loan officer would need to give you a valid quote to refinancing your home, condo or commercial property. Print this article and have the answers written down before shopping.
Print this article and have the answers written down before shopping.
1. Address or addresses?
2. Phone contact numbers? (email)
3. Purchase date?
4. Purchase price?
5. Estimated value? (Loan compared To the Value = LTV %)
6. Bedrooms, bathrooms and square footage?
7. 1st balance and loan date? (when the loan began)
8. 2nd balance and date?
9. Yearly income? (borrower and co-borrower)*
10. Self employed? (stated income / easy doc)
11. Fico (credit) Score?*
*Annual income is needed to calculate Debt to Income Ratio
*Running a credit check also gives the loan officer an idea of your debt to income ratio.
A valid quote can be given without running a credit report, rates for loans are based on credit score first.
Run your own credit check, all you need is your three digit score to get an approximate quote.
Each number is based on lender questions required by all banks for the loan processor and the Escrow Department to begin the analyzation of your individual loan request. Some loan requests may come back as many as 25 times from the lender as each bank dissects your ability to pay back the loan based on the information you have given.
So for some brokers to take on the responsibility of processing a loan, the expense of paying highly trained employees is taken into consideration when asking for points to be put on the loan.
Most borrowers see adding points as adding commission for the loan officer.
Is this agent working hard to find the cheapest loan for you, is he disclosing as much information as possible to educate you and keep you apprised of the ongoing process?
Ask to see what you are paying for.
The Rate Sheets each Brokers office receives, either through email, lender web page, or by fax, can change on a daily bases. Request to see those rate sheets, based on your individual borrower information, so that you know what you are paying for.
Any loan officer denying this request is afraid of discloser and not to be trusted.
For every credit score there are subsequent rates. Each rate has its own set of variables.
• LTV (loan to value), what percentage your current loan compares to the value of your home.
• If you’re willing to have a Pre-Pay penalty attached if decide to close the loan earlier than the agreed upon time.
• The length of the loan or the length of the initial start rate
• Are you doing a normal or stated proof of income
• Finally, how much loan do you qualify for
You don’t need a broker’s license to be ready to negotiate your new loan.
And negotiate you must, there is always a type of loan where the loan officer makes a lot of money, where you don’t pay any money, and the middle ground where you both benefit.
Many lenders promise the moon when it comes to free loans with no closing costs, no points and no fees.
The truth is, those costs are built into the loan, and you are just going to pay for them later than sooner.
Send them reeling by asking to see the amortization schedule. Ask for a simple break down of all of your payments. Ask if any points are “built into the loan.”
Ask how much they are paying for the appraisal. If a loan officer lies about this information, call the D.R.E. (Department of Real Estate) and have the loan canceled.
Print this article and keep it next to your phone or computer when hunting for your best loan.
Run your own credit report so you don’t have to give out your Social Security number on the phone or the World Wide Web.
Stick to the eleven points in this article, if a loan officer asks for less he’s just giving you the quote you want to hear, not what he can deliver.
Get that good faith estimate; it is the starting brick from which your broker will build the castle of trust between you, and he is responsible for keeping it in good standing.
Dennis sweatt is an Authur, Artist and Webmaster and currently works in marketing for a top earning mortgage company. Article Source: http://EzineArticles.com/?expert=Dennis_Sweatt |
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