Entries from Searchlight Crusade tagged with 'rate/cost'

Loan Fall-Out And The Effects Upon Consumers

This is going to be a long article and somewhat technical in places, but it needs to be covered and it's important to everyone who is thinking about getting a real estate loan. "Fall-Out" is very simple: The number...

The Difference Between a Reliable and Unreliable Prequalification or Preapproval Letter

If you don't know, chances are your agent doesn't either. Even if you know, chances are that your agent is as clueless as a newborn about loans. I and my clients get asked for all kinds of nonsense (to put...

Whatever the New Trick in Loans is, It's an Always Attempt to Keep From Really Competing On Price

It seems every week I get asked about some new or revived trick that loan providers are pulling. The one thing they all have in common is that they are methods to avoid competing on price. What the basic terms...

Truth In Lending and APR

(Note: This article is a reprint of one of the earliest articles I wrote, from a time when rates were higher. The principles, however, are quite valid - and even reinforced by the fact that rates now are much lower)...

Why It May Be Costly to Reject Paying Points

I hear it and read it all the time - advice that says to pre-emptively reject the possibility of paying points. People that talk to me about loan rates that tell me they will not consider any loan that...

Why The Higher Rate Loan Is Often Better

The short answer is "Because it costs less". It costs more money to get a lower rate - simple fact. It takes time to recover the extra money you spend to get a lower rate via that lowered cost of...

Lowballing Mortgage Quotes Versus "Junk Fees"

One of the things that most mortgage and real estate consumers get mixed up on is the distinction between low-balling and junk fees. Junk fees are when they add fees that really aren't necessary to what you're paying. Low-balling is...

Fifteen Year Loans: Are They A Good Idea?

My take on the matter is "mostly no", but they do have some uses. The one advantage that they usually carry a lower interest rate. There have been exceptions to this, just as there have been exceptions to the...

Don't Roll Mortgage Refinance Costs Into Your Balance If You Wouldn't Pay Them Cash

One thing that is very common in the mortgage industry is masking loan costs by rolling them into your loan balance. People are less sensitive to being asked to roll this money into their loan balance than they are about...

Deciding You Don't Want A Particular Mortgage Loan

I have questions to ask you about the loan for house. I have been work with one broker since DELETED and I just tell her on the phone that I chose her and that she can start to do...

What Are Points and How Do They Work?

That was a question I got. One point, either discount or origination, is one percent of the final loan amount. After all of the loan amounts and fees and what have you are added, for a loan with one point,...

Temporary Rate Buydowns

Every so often I run across a reference to a "rate buydown" I don't like to use them because they don't benefit the client, but I should explain them, what they are, and how they work. A rate buydown is...

What Are Recurring and Nonrecurring Closing Costs?

Many people are uncertain as to what closing costs are. Basically, they relate to the costs of doing the transaction. There are people who work on getting your loan through the process of approval and funding, and those people have...

Questions You Should Ask Prospective Loan Providers

Mortgage - Questions you must ask every provider about every loan when you are shopping. Permission is hereby granted to print this out and use it for non-commercial purposes so long as no alterations are made and copyright is preserved....

What Types of Mortgages Are Available?

So what else is available, besides the thirty year fixed rate loan? There are many kinds of loan out there. Here's a quick overview: A Paper In addition to the thirty year fixed, there are several other varieties of fixed...

APR vs APY: What The Difference Between Note Rate and APR Tells You

I have in the past told people to ignore APR. APR should not be used to compare between loans. Not only is it a one dimensional number used to measure what is fundamentally a two-dimensional trade-off between rate and...

The Return of Portfolio Lending

For a long time, Fannie Mae and Freddie Mac had a policy that they would not fund investment property (non-owner occupied) beyond 10 loans for a given investor. Although it did impact a certain number of investors, for most folks...

Mortgage Markets and Providers and Yield Spread Explained

There are actually several distinct marketplaces consumers can obtain their funds from, and several types of providers. John the wealthy highly salaried person with great credit and a substantial down payment should not and usually does not obtain his mortgage...

What If You Cannot Refinance Later?

People always assume they'll be able to refinance later. Even most of my articles have it as an implicit assumption. But what if you can't refinance later? There are situations where it happens. Many situations, as millions of people...

Mortgage Rate, Points, and Closing Costs

Everybody knows that you want the lowest rate, and everybody knows that you don't want to pay any money you don't have to, in order to get it. However, not everybody makes the connection that it is always a tradeoff...