Most people tend to shop for a mortgage based upon the payment. They figure the lowest payment will be the cheapest loan. This is the way most people make banks rich. Because they are looking for the loan with the lowest rate and the lowest payment, they choose the loan with two or three points …
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Mortgage Loan Rate Locks
(NOTE: This is a historical post. Things have changed a lot in the mortgage business since it was written. For one thing, the Feds wrote new laws and regs adding about 3 weeks to the time it takes to do a loan, so a 45 day lock has become the default. For another, lenders are …
A List of Mortgage Provider Red Flags
This is going to be one of those occasional posts that gets expanded and reposted from time to time. This list is not exhaustive, although over time it is intended to become closer. If you have one, send it to me (dm at) Any of these is sufficient reason, all by itself, not to do …
Getting Rich Quick in Real Estate
On a very regular basis these days, I’m running into people who took paid money for a get rich quick seminar and are looking to buy property for zero down and immediately sell it for a $50,000 profit. Somebody With A Testimonial Told Them How It Could Be Done. Sorry folks but the people with …
California Mortgage Loan Disclosure Statement
California replaced the one page federal Good Faith Estimate with a two page Mortgage Loan Disclosure Statement. I haven’t seen a lot of abuses of this yet, mostly no doubt because it is so new. I don’t even know if there are solid regulations and implementation policies and standards on it yet. I haven’t seen …
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An Apparent Red Flag That Isn’t
For all of the rants I post about bad business practices, there are a lot of things the mortgage industry gets right. One of these looks like a red flag not to do business with them, and may seem like a cruel trick, but it is neither. With every single loan that is done, you, …
Types and Levels of Mortgage Documentation
No matter which provider, no matter what type of loan you get, nobody is going to loan you money without the appropriate documentation. The more documentation you have that you are a good risk, the better the rate you are going to get, and the lower your costs are going to be. Everybody hates filling …
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Real Estate – Third Party Service Providers
RESPA (Real Estate Settlement Procedures Act) prohibits an agent from requiring you to have other services performed by outside companies. RESPA also prohibits an agent from accepting payment (kickbacks) from third party service providers. Nonetheless, these are major problems in the real estate world. It is an unfortunate fact that many agents care far more …
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Questions to Ask a Prospective Loan Provider
Mortgage – Questions you must ask every provider on every loan. (This list is trying to be as exhaustive as possible, but is likely missing some important questions. If I missed one, send it to me: dm at ) What is the rate? What is the amortization period? Is there a possibility that the note …
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Mortgage Rate and Points
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 between the two. At any given point in time, each home lender has it’s own …