Entries from Dan Melson's La Mesa Real Estate and Mortgage Website tagged with 'lender games'
New Consumer Article: Changes In The Mortgage Market And Transparency Since 2005
It's been a while because I've been both busy and depressed over dis-improvements in the market and their effects upon consumers, but yesterday I found time to write a new article Changes In The Mortgage Market And Transparency Since 2005....
New Consumer Article: Assuming Seller Concessions On Loan Quotes
The new consumer article for today is Assuming Seller Concessions On Loan Quotes, which discusses why lenders do this: To make an expensive loan look not so expensive. But there is no way to get seller concessions (Seller Paid Closing...
New Consumer Article: The Loan Shopping Koan
The new consumer article for today is The Loan Shopping Koan, talking about the contradiction offered by dueling interests: The fact that while consumers want the best possible loan, against the opposing fact that it's very easy for loan providers...
New Consumer Article: There Is No Fairy Godmother for Loans
The new consumer article for today is There Is No Fairy Godmother for Loans. To avoid becoming a government statistic, ask prospective loan providers the hard questions before you sign on the bottom line - or better yet, before you...
New Consumer Article: Games with Mortgage Loan Rate Locks (Games Lenders Play Part 10)
The new consumer article for today is Games with Mortgage Loan Rate Locks (Games Lenders Play Part 10), talking about how you can be told your rate is locked when it isn't, what the benefits of playing this game are...
New Consumer Article: APR vs APY: What The Difference Between Note Rate and APR Tells You
Today's new consumer article is APR vs APY: What The Difference Between Note Rate and APR Tells You. I advise people to ignore APR as a means of shopping a loan. But there is some information in the difference between...
New Consumer Article September 15th, 2008
Today's new consumer article is Mortgage Accelerators, Money Merge, and Paying Your Mortgage Down, which deals bluntly with the contention that these programs that allegedly "pay off your mortgage in a fraction of the time" actually help. They don't. I...
New Consumer Article August 21, 2008
Today's new consumer article is The Moment of Truth, Signing Bad Loan Documents and the Right of Rescission, which discusses the Moment of Truth that happens in every loan - when the loan documents are presented. Ideally, there should be...
New Consumer Article August 13, 2008
Today's new consumer article is Why Lenders Don't and Won't Tell Borrowers Their Loan Was Turned Down, which discusses why most lenders don't make this very simple disclosure. Basically, it's because they lose money by being honest....
Why Is My Rate Higher Than My Lender Promised?
First off, neither the California Mortgage Loan Disclosure Statement nor the Federal Good Faith Estimate are promises, commitments, or anything more than your loan provider wants them to be. Quite often, they're nothing more than a fictional story told...
Prepaid Interest and Why You Never Really Skip a Mortgage Payment
Many people think that mortgage interest works like rent: paid in advance before you live in the property for the month. This is not the case. Mortgage interest is paid in arrears. As you begin the month, interest begins...
Why Cost Is As Important As Rate For Mortgage Loans
A few days ago I wrote an article explaining why borrowers should consider a 5/1 ARM, because the tradeoff between rate and cost is lower for that loan, and most people don't keep their loans 5 years anyway, so...
Debunking the Money Merge Account Scam (Games Lenders Play, Part 8)
Mortgage Accelerators, or Money Merge Accounts, have become the thing that everyone's pushing of late. I have gotten so much junk mail about this from more originators (who don't know who I am) and wholesalers (who should) in the last...
"We'll Beat Any Quote" in Mortgage Loans
Just like "we'll beat any deal!" in any other competitive sales endeavor, this is a game. Actually, it's even more of a game for loans than it is anywhere else, used cars included. What they are hoping is that you'll...
Dissecting the "Lending Game"
(This was written some time ago, when rates were higher, but the principles involved are the same) Right now X is offering me a loan that looks something like this: 80/20 No down payment On the /80: 6.5% FIXED interest...
Read The Full Note
Just got a search "how can I tell if my prepayment penalty applies to selling my home" Read The Full Note. You need to do this before you sign it. I know that many people are just thinking "Sign this...
Yield Spread is a Beneficial Tool That Can Be Misused
If you read the papers and the congressional record on the current housing crisis, you might think yield spread is the central culprit for the entire meltdown. You would be wrong. Yield spread is a beneficial tool, offered voluntarily by...
Inducements to Use A Particular Lender for a Purchase
One of the things I'm seeing more of in MLS listings and developer advertising, among other places, is the phrase "$X in closing cost credit (or "$X in free builder upgrades" given for using preferred lender" Sounds like a bargain,...
Games Lenders Play, Part V
Hello, I've been reading your website for awhile now, and have found it very helpful as I'm learning to navigate this crazy loan process! I had a question I was wondering if you could write about/answer. We currently have...
Games Lenders Play (Part IV)
I was approached by these folks a few weeks ago via email. I attempted to get them to write up the experience themselves (and I would still like you to if you're reading this), but I wanted to write something...
Games Lenders Play, Part II
Here's another advertisement that I've gotten in the mail: "Pick a Pay, Any Pay!' The Revolutionary Option ARM!" "Start rates as low as 1%!" Loan amount $100,000 Payment $321.64 $200,000 $643.28 $300,000 $964.92 $400,000 $1286.56 Could this help save you...
Games Lenders Play, Part I
I was a little shy of ideas of stuff I wanted to write about, and too lazy to finish my research on some stuff I'm working on. But: I get the same junkmail and spam most of you folks do....
Financing Tricks and What You Can Afford
Hi Dan, I am a first time home buyer and a big fan of the advice on your blog. I was wondering if you could offer some advice on my current situation. I apologize for sending you this question...
Biweekly Mortgage Spam
Sometimes spam makes writing an article all too easy. Here is a piece of spam I got today because my email at work contains "realestate.com", with identifying information taken out. This goes to show that the financial ignorance of most...
Whatever the New Trick in Loans is, It's an Attempt to Keep From Competing Based Upon 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...
Special Programs Means Potential Special Problems
An e-mail I got from a single mother I spent two months working with before she found a special low income program for a property she wouldn't have been able to afford through me. The first paragraph is her addition...
Mortgage Loan 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...
Signing Off Loan Conditions
what is a underwriter final "sign off" on the conditions First off, it needs to be mentioned that a good loan officer gathers information and puts a full package, with all of the information an underwriter should need, before...
Lowballing 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...
Weighted Average Cost Of Capital
or Figures don't lie, but Liars Sure do Figure! With the loan rates being significantly higher than they were a couple of years ago, we've got a lot of people with loans in the low fives, interest rate wise. One...
Don't Allow Yourself To Become A Victim of Bad Real Estate Practice
This woman made herself a victim stayed in a hotel for 7 weeks looking for my "Dream Home." And, when I found it, even though it wasn't in my price range, I knew I would do anything I could to...
Questions You Should Ask Every Prospective Loan Provider
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....
How To Effectively Shop for A Real Estate Loan
This is a little harder than shopping for buyer's agents, so congress critters might not be able to do it. But it's nowhere near as tough as high school algebra, so even if you're a politician you can just get...
What Lenders Talk About Isn't Important, It's What They Deliver
I'll keep hitting this and hitting this until everybody understands this critical point. From email: First of all, I love your website. It is just a plethora of information for first time buyers like me who wants to be an...
Games Lenders Play, Part VII - Selling Mortgage Accelerator Programs
I thought I'd share this with you as an example of the sort of mind set to beware. This is a real email I received a few days ago, with identifying information redacted I found you through the DELETED web...
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