Charlie Harper
Footballguy
Hayward. Not a sexy place, but where I grew up.DA RAIDERS said:
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Mortgage Rates (6 Viewers)
- Thread starter MechEng
- Start date
Chadstroma
Footballguy
Emailed back, check your inbox asap and decide right away. Time running out.The Z Machine said:
The Z Machine
Footballguy
Already completed the application. Chad is the man. I wonder how much money he's saved FBGs over the last 12 months.
Chadstroma
Footballguy
Ya'll should take up a collection for me! I KID! I KID!!! I have no interest in losing my license.
I am happy to do it. I enjoy helping people and saving them money. I have always tended to be successful in banking/financial services because that is my aim even when it has been giving up income by not getting business. It seems to always come back whether direct referrals or business karma (I don't believe in real karma).
I actually have been thinking about looking into a change towards being a financial coach because that is what I enjoy the most and end up doing a lot of many times just to help. And I tend to be pretty damn good at it.
Thanks for the props. Appreciated.
Ron Swanson
Footballguy
For what it's worth, I think there is a huge opportunity for a secular financial coach in the Dave Ramsey style to do a lot of good in this country.
Garrett
Footballguy
I live in a small town and the local options are not really simpatico with moving quickly on anything...
Are any of the prominent online sources legit?
Chadstroma
Footballguy
Yea, I have more than a couple of bones to pick with Dave Ramsey. A few being him running a business masquerading as a ministry and him giving absolute horrible advice on credit, mortgages and investing. His singular message of debt avoidance is great but monotone and actually hurtful at times. His advice is best as an intro to personal finance that never were taught anything and/or got themselves into hard spots but most people can and should grow out of it. His whole teaching is colored by his own bankruptcy and honestly how he can benefit from it (like after giving horrible advice on mortgages then turning around and sending people to Churchill Mortgage so they can get a horrible deal because he gets a big fat check written to him for it).
Chadstroma
Footballguy
⚡DEADHEAD⚡
Footballguy
Despite my WF travails...Recall WF failed to record my HELOC with the county. County said the notary stamp was illegible and WF failed to do anything about it...I locked (70 day) today on a jumbo at 2.875% and no points. STOKED.
Bought our house in May 2019 and went from 4.0% at purchase, refi'd to 3.625% and now to 2.875%.
My broker says 2.75% may soon be available on jumbos. I didn't want to take the chance.
Bought our house in May 2019 and went from 4.0% at purchase, refi'd to 3.625% and now to 2.875%.
My broker says 2.75% may soon be available on jumbos. I didn't want to take the chance.
FishNSuds
Footballguy
The processor and underwriter are killing me. Just wrote my fourth explanation letter. I only re-fiing for 50% of the value, have an 840 score, own numerous properties, and haven't missed a payment in 30 years. Oh....I have enough in savings/retirement to payoff the loan outright. Just sign off on the loan already. No wonder this stuff takes 2.5 months..
My local bank with the HELOC hasn't been much help either. Their foolishness may cost them a $1mm business account with money that has sat there for 5 years earning 0.1% which doesn't even cove their monthly fees.
My local bank with the HELOC hasn't been much help either. Their foolishness may cost them a $1mm business account with money that has sat there for 5 years earning 0.1% which doesn't even cove their monthly fees.
Senor Schmutzig
Footballguy
Having the same problem with my underwriter. Granted, we were a little aggressive with the first closing date but have already have the seller sign one extension and now they are threatening to not sign the second one (currently scheduled for 9/24) as they think they can put it back on the market and get more money. I'm about 30% confident they would actually do that but it's still concerning thinking that I could lose this property because the process is taking so frigging long.FishNSuds said:
Punxsutawney Phil
Footballguy
Refinanced, closed today 15y, 200k, 2.375
Last edited by a moderator:
Chadstroma
Footballguy
They have to fulfill the Fannie/Freddie guidelines. It doesn't matter if your score is 850, 10% LTV for a loan of $100K with $10 billion in assets..... it must be underwritten to their guidelines. Which means, if there is something that needs to clarified/explained, then they will need a LOX to explain it. Beyond that there are overlays and some lenders are better than others. Sorry man, trust me, I understand, I deal with this crap on a daily basis. I am not saying it is right just trying to explain it.FishNSuds said:
Chadstroma
Footballguy
Things were bad before (like talking about a few weeks ago or a month ago) but now it is ridiculous. Tons of refi's on top of already tons of refi's trying to get in before the FHFA extra pricing for the Fannie/Freddie cash grab and the purchase business is going strong. I have one lender that when I submitted the loan the turn times for condition review were 24/48 hours. Right now it is 7-8 days.
And I am trying hard to get a rush put through so we can close on time on the 30th but may not be able to :X The entire 'ecosystem' is clogged. I have loans that are all done just waiting on something like a subordination or paperwork from the HOA etc. I had one call center type insurance give my processor a 5 day turn time on getting a mortgagee added to the insurance docs.... this is something normally I get back within an hour or two.
Title companies on purchases have been the bane of my existence recently as a whole lot of my purchase closings that we have delivered on time on are getting screwed at the end because the title company just refuses to even do basic communication and then blame us for a delayed closing when they give us what we were begging for for days the morning of the day the closing is suppose to take place.
Sigh.
Chadstroma
Footballguy
Been a bit...
Here is a few tips for you guys when it comes to mortgages. (ok, more than a few)
#1: The difference between retail and wholesale. Retail is your banks, credit unions and direct lenders (some big direct lenders would be Quicken, Guaranteed Rate, Fairway, etc). Wholesale is your mortgage broker. I shouldn't have to tell you which is going to end up giving better rates and cost on average.
#2: The bigger the Bank the more they usually suck. UNLESS you are your typical FBG rolling in cash. If you are, then the big and regional banks that have wealth management departments will be very aggressive in offering jumbo loans. They basically use it as a loss leader. They will give you a great deal and then get you into their wealth management where they make all their money off of you. When it comes to mortgages, a jumbo is pretty much the only time you want to talk to a bank. Otherwise, avoid banks though sometimes your smaller banks will have a pretty good deal.
#3: If you see them advertising on TV, I promise you, they suck. Quicken spends ridiculous amounts of money on advertising. Why? Because the people who don't know better who have done loans with them before and almost always got bent over are paying for this marketing machine. Plus, they are pretty much the slimiest lender out there. Over and over and over again hearing clients tell me "they said X to me" and in reality it is "Y". They also typically will start off with what seems like a great rate and then charge 3 points in origination charges. DO NOT go to Quicken (aka Rocket Mortgage) or one of the slim ball VA lenders like Veterans United or New Day.
#4: I love credit unions. Huge fan of them. I belong to two of them. CU's are usually your best bet for checking, savings, car loans, personal loans, equity loans or lines, etc. However, one area that they are not usually your best bet is mortgages. The reason is mostly about scale. There are some large CU's but most are still relatively small. They do not do enough volume to be efficient and the large loan amounts take a big chunk of their reserves. Go ahead and check with your CU, they can offer some good deals, I have seen it and they will still tend to beat banks and direct lenders but not usually the best bet.
#5: Rate is not the end all be all of doing a loan. You have the rate which of course is important but there are also fees and origination charges. A typical game that is played is showing a great rate but then when you compare to another lender you see that you are really PAYING for that great rate. Often times as a broker, I am able to match the rate and give a credit versus the origination points they are charging. Be mindful of that.
#6: Use the Loan Estimate! Wherever you go, when you get the Loan Estimate, shop it to other lenders. You can just send it to the lender and let them come back with their offer or you can put more work in it and just shop and compare rates. What happens if you do? Worst case, you get the peace of mind that you are getting a good deal. Best case, you save yourself thousands of dollars!
#7: Your current lender is not going to make it easier than going to another lender. They will need to get all new docs or if it a streamline another lender can do a streamline as well.
#8: Unless you hate yourself and want to throw your phone away forever do not go to a website that 'shops' loans. First of all, they don't really. All they are doing is selling the leads to lenders. Second, you will get bombarded by phone calls and wish you never even heard of Lending Tree or whatever else.
#9: Always shop lenders. Mortgage brokers do the shopping for you accessing multiple lenders and getting wholesale pricing.
#10: Don't make assumptions about what you can or can not do with a refinance. Talk to someone who actually knows. They can go over your options after figuring out your situation and your goals. I have seen some bad thinking in here that is costing people significant money.
#11: The better your credit score the better your rate. You are going to top out around the 740-750 area. So, don't worry about getting an 800 credit score.
#12: If you have more debt other than the mortgage/equity loan or line then you might be better off refinancing all the debt into the home.
#13: DO NOT listen to Dave Ramsey when it comes to mortgages. He is a dolt when it comes to mortgages, gives horrible advice and then sends his followers to Churchill mortgage because he gets paid advertising from them. It disgusts me. People trust him and he sends them to a crappy retail lender because he gets a big check from them on top of giving really HORRIBLE advice that ends up costing people tons. Just ignore him when it comes to mortgage advice.
#14: If you are getting a mortgage, don't do anything stupid like deposit a bunch of cash into your account or buy a new car or change jobs. Anything to do with your job, credit and income can cause problems for the loan. Yes, I don't care if you are doing the same job for more money- I can't close your loan on time now. (real life situation, I was able to save the loan but this ding dong couldn't get through his head that most lenders would have killed the deal and it was all our fault somehow that we couldn't close on time).
#15: Realize that the vast majority of down payment assistance programs are pushed by lenders who do them and realtors who want you to buy a home with them as free money is NOT. Why do they pitch it like that? Well, why wouldn't you use a lender or realtor who is offering you free money?! This is the way that most of them work... they are set up to give money in a form of a forgivable loan or silent second or another such form. You must keep the loan for an extended period of time 5-7 years is most common. Once you do (meaning you can not sell or refinance that loan) then you are free! Here is the thing... that 3-3.5% of the purchase price that they gave you jacked up your rate. I have calculated the differences- not from different lenders but from lenders that I know using a program, the rate you would get with them without the DPA and the rate you get with it... and let's say you got $10K from them... that $10K ends up costing you $30-40K over the period that you did PLUS potentially an opportunity cost of refinancing as I have done for all my clients who listened to me last year and now that rates have dropped are realizing large savings. There are true grants out there (where there is no ties to the money) but most of these also have a higher rate. I have access to some of these programs but only have done one in the last few years and that was after being sure to explain everything in detail and the real cost to the client (side not, the plan was to refi them later which we plan on doing in a couple of months).
#16: If you are veteran, first responder, medical profession- the great sounding program (Homes for Heroes is the largest one) where you get money back isn't as great as it sounds. I promise you. The realtor part of it is actually a good deal for you but the lender side where they typically pay for your appraisal (around $400-600) is likely costing you a ton of money in the rate and cost of the loan. These are usually retail lenders who have lot's of extra cash (there is a reason why they have to charge higher rates and fees/origination) that pay into these programs, which are relatively expensive (for a lender about $1800 a year for Homes for Heroes just to be part of their program and that is it). You can still shop the lender. DO SO!
#17: First time home buyer programs are usually marketing schemes. There are some benefits offered if you are doing a conventional loan which anyone can have access to. Other things are usually the DPA programs (see #15) and should be avoided. Your third cousins best friend's dog's breeders brother who got $10K free money to buy a home is more times than not money that cost them.
#18: Most loans over 80% loan to value that doesn't have mortgage insurance is costing you in a higher rate. If you are doing conventional loan, you can get rid of the MI later. If it is baked into the rate it is there for life of the loan.
#19: FOR THE LOVE OF GOD AND ALL THAT IS HOLY if you are building a home PLEASE understand that the builders preferred lender that they are going to give you $10K in free upgrades for using them is going to cost you much more money than the $10K they are 'giving' you. Here is how this scheme works. The free upgrades actually are going to cost them maybe $2K if that to do. In return for you using their preferred lender and getting absolutely bent over they are going to get a nice big fat check worth alot more money. The builder and the lender will laugh at you sitting in the model house counting your money you just forked over as they watch you move in.
#20: A realtors 'preferred lender' can be good or can be bad. There is no way to tell. Here is how it works in the industry. Retail lenders who tend to charge more have bigger budgets to spend on marketing. They will 'partner' with realtors and pay for the realtors marketing (also sponsor things like their meetings, or holiday party, or conferences or whatever else) and in return the realtor makes them their 'preferred lender' so the realtor will refer you to them when you are not already using a lender. Now, you can also have 'preferred lenders' that don't do that stuff and the realtor has found them to be a good lender. (side note here, in the average realtors eyes, a good realtor is one that closes deals and does it on time and not so much about rate and cost) For example, I am several realtors 'preferred lender' but do not spend money on them and it is really based on them knowing I can get more loans approved, close on time and give their clients great deals. Overall, NEVER get loan advice from a realtor unless they are the rare ones that are licensed for lending and actually know what they are talking about (that is significantly less than 1% of them)
#21: You don't need 20% down. Don't keep waiting to buy when you are spending money away on rent. Every month you pay someone else's mortgage (paying rent) is money you will never see a dime of again. As an owner you are building wealth. Think of it this way... landlords are landlords for a reason. They are not losing money and on top of it are gaining equity. For most Americans, their 'wealth' is almost exclusively in their homes. Not retirement accounts or stocks etc but built up equity from paying down principle and appreciation of their homes which is historically pretty consistently 5% over periods of time (including booms and crashes).
#22: You don't need perfect credit to get a mortgage. You can do a FHA loan with a minimum credit score of 580 with as little as 3.5% down of the purchase price.
#23: When picking a good realtor find out these things about them: A) Do they do this as a full time job or is it a side gig or something they do when they are bored etc. You want a full time realtor for the experience and focus. Trust me. The exception on this would be a semi-retired realtor but honestly, they are usually ones to pass on as well. You want someone who knows the market, is sharp on negotiation and has good contacts. B) How long have they been doing the job. Experience counts for sure. But I rather go with a rookie doing it full time than someone been doing it 10 years as a part time gig. C) What is their availability. You want someone that will be available on your time tables and not theirs. D) How many houses have they sold or closed on? It will give you an idea about how productive they are. But keep in mind, someone who isn't as productive might be hungrier and more flexible to you versus someone who is doing tons of volume.
#24: Always get an inspection done from a good inspector. Do not skimp here. A good inspector will give you very important info on the home even if there is nothing to be concerned over and potentially catch a very big problem. Keep in mind even the best inspectors will not be able to find out anything and everything wrong with a house. Find out of they do mold and radon testing or not and if it is extra if they do. I would go ahead and do it. Keep this in mind, this is usually the largest financial transaction of your life so far. Do you want to be penny wise and dollar foolish on it?
#25: If you are military or a vet. Run away from supposedly veterans lenders like Veterans United and New Day (and more but those are two big ones) THEY SUCK. Even good places like USDAA (who does insurance well), Navy Fed, may do a lot of good for vets in other areas but are not the best in mortgages.
#26: As I will get to soon... brokers are better. This is true for insurance too. I see insurance quotes often and I personally did my own shopping where I shopped 10 carriers plus one insurance broker. The broker easily won out. Plus, the big carriers suck if you end up with a claim. I have a whole personal story about Allstate sucking big hairy monkey balls. On top of it all an agent at a large carrier has NO sway on anything on a claim. A broker actually does (as counter intuitive as that seems) because they can tell the insurer that if they don't do something right that he will not send that insurance company any more business. The captive agent has no choice.
#27: If you are in a rural area, check out a USDA loan. You can finance up to 100% but keep in mind, you actually might end up better served doing a FHA loan depending on specifics.
#28: Brokers are better. They weren't always... they use to be a pack of scumbags and slimballs who would screw over their own mothers for an extra 20 spot. Before 2008 I had plenty of chances to be a broker and would not even though I would have made 3 or 4 times more than I was making because again the vast majority were nastier than moldy dog poo with worms in it. That being said, even back then you could get a better deal from a broker IF you knew what you were doing and could protect yourself. Otherwise, you could get screwed so badly that it would make going to Quicken seem like a good deal. In fact, I actually used a broker on both of my home purchases even though at both times my wife and I worked at banks. That is right, when bankers want to do their loans- you know who they come to? Brokers. Things have changed and really the consumer advocates are now brokers and the things they use to do before that would screw people over are things that can not be done now. Not only are you going to get a better deal at a broker the vast majority of the time but you are also not going to get screwed over. Plus they have options that banks, credit unions and direct lenders don't have to get you approved if you have a harder to finance situation like a business owner, bad credit, recent major credit event (foreclosure, bankruptcy, etc) etc. Also, brokers can close quicker than other lenders on average. How do you find a broker? Well, you can ask me, I know brokers throughout the country. I have no problem connecting you to one (and if you are wondering, by regulation and the risk of losing my license, I can not get paid for referring you to a broker... it is purely out of help you out) or if you want you can check out www.findamortgagebroker.com oh... and if you are in Illinois, I can help you directly.
#29: You are not locked in to a lender with a pre-approval. Unscrupulous lenders who tend to overcharge will have a lot of nasty little tricks that they do to keep you stuck with them. Fear is one of the big ones backed with lies. That fear will be to tell you that you can not change lenders once you have an offer accepted from a pre-approval or you can lose your earnest money. FALSE! Or that you will end up not being able to close on time with another lender (a favorite of retail loan officers to say about brokers when broker turn around times are actually quicker than retail). Your Loan Estimate is provided to assist you as the consumer to not only better understand the true costs of the loan but to be able to shop your loan around or the best options for you and then be able to compare them as close to apples to apples as possible. Don't let liars overcharging you win!
Hope this helps guys. I am always willing to help out if you have any questions or want to connect with someone licensed for your state. Just DM me.
Here is a few tips for you guys when it comes to mortgages. (ok, more than a few)
#1: The difference between retail and wholesale. Retail is your banks, credit unions and direct lenders (some big direct lenders would be Quicken, Guaranteed Rate, Fairway, etc). Wholesale is your mortgage broker. I shouldn't have to tell you which is going to end up giving better rates and cost on average.
#2: The bigger the Bank the more they usually suck. UNLESS you are your typical FBG rolling in cash. If you are, then the big and regional banks that have wealth management departments will be very aggressive in offering jumbo loans. They basically use it as a loss leader. They will give you a great deal and then get you into their wealth management where they make all their money off of you. When it comes to mortgages, a jumbo is pretty much the only time you want to talk to a bank. Otherwise, avoid banks though sometimes your smaller banks will have a pretty good deal.
#3: If you see them advertising on TV, I promise you, they suck. Quicken spends ridiculous amounts of money on advertising. Why? Because the people who don't know better who have done loans with them before and almost always got bent over are paying for this marketing machine. Plus, they are pretty much the slimiest lender out there. Over and over and over again hearing clients tell me "they said X to me" and in reality it is "Y". They also typically will start off with what seems like a great rate and then charge 3 points in origination charges. DO NOT go to Quicken (aka Rocket Mortgage) or one of the slim ball VA lenders like Veterans United or New Day.
#4: I love credit unions. Huge fan of them. I belong to two of them. CU's are usually your best bet for checking, savings, car loans, personal loans, equity loans or lines, etc. However, one area that they are not usually your best bet is mortgages. The reason is mostly about scale. There are some large CU's but most are still relatively small. They do not do enough volume to be efficient and the large loan amounts take a big chunk of their reserves. Go ahead and check with your CU, they can offer some good deals, I have seen it and they will still tend to beat banks and direct lenders but not usually the best bet.
#5: Rate is not the end all be all of doing a loan. You have the rate which of course is important but there are also fees and origination charges. A typical game that is played is showing a great rate but then when you compare to another lender you see that you are really PAYING for that great rate. Often times as a broker, I am able to match the rate and give a credit versus the origination points they are charging. Be mindful of that.
#6: Use the Loan Estimate! Wherever you go, when you get the Loan Estimate, shop it to other lenders. You can just send it to the lender and let them come back with their offer or you can put more work in it and just shop and compare rates. What happens if you do? Worst case, you get the peace of mind that you are getting a good deal. Best case, you save yourself thousands of dollars!
#7: Your current lender is not going to make it easier than going to another lender. They will need to get all new docs or if it a streamline another lender can do a streamline as well.
#8: Unless you hate yourself and want to throw your phone away forever do not go to a website that 'shops' loans. First of all, they don't really. All they are doing is selling the leads to lenders. Second, you will get bombarded by phone calls and wish you never even heard of Lending Tree or whatever else.
#9: Always shop lenders. Mortgage brokers do the shopping for you accessing multiple lenders and getting wholesale pricing.
#10: Don't make assumptions about what you can or can not do with a refinance. Talk to someone who actually knows. They can go over your options after figuring out your situation and your goals. I have seen some bad thinking in here that is costing people significant money.
#11: The better your credit score the better your rate. You are going to top out around the 740-750 area. So, don't worry about getting an 800 credit score.
#12: If you have more debt other than the mortgage/equity loan or line then you might be better off refinancing all the debt into the home.
#13: DO NOT listen to Dave Ramsey when it comes to mortgages. He is a dolt when it comes to mortgages, gives horrible advice and then sends his followers to Churchill mortgage because he gets paid advertising from them. It disgusts me. People trust him and he sends them to a crappy retail lender because he gets a big check from them on top of giving really HORRIBLE advice that ends up costing people tons. Just ignore him when it comes to mortgage advice.
#14: If you are getting a mortgage, don't do anything stupid like deposit a bunch of cash into your account or buy a new car or change jobs. Anything to do with your job, credit and income can cause problems for the loan. Yes, I don't care if you are doing the same job for more money- I can't close your loan on time now. (real life situation, I was able to save the loan but this ding dong couldn't get through his head that most lenders would have killed the deal and it was all our fault somehow that we couldn't close on time).
#15: Realize that the vast majority of down payment assistance programs are pushed by lenders who do them and realtors who want you to buy a home with them as free money is NOT. Why do they pitch it like that? Well, why wouldn't you use a lender or realtor who is offering you free money?! This is the way that most of them work... they are set up to give money in a form of a forgivable loan or silent second or another such form. You must keep the loan for an extended period of time 5-7 years is most common. Once you do (meaning you can not sell or refinance that loan) then you are free! Here is the thing... that 3-3.5% of the purchase price that they gave you jacked up your rate. I have calculated the differences- not from different lenders but from lenders that I know using a program, the rate you would get with them without the DPA and the rate you get with it... and let's say you got $10K from them... that $10K ends up costing you $30-40K over the period that you did PLUS potentially an opportunity cost of refinancing as I have done for all my clients who listened to me last year and now that rates have dropped are realizing large savings. There are true grants out there (where there is no ties to the money) but most of these also have a higher rate. I have access to some of these programs but only have done one in the last few years and that was after being sure to explain everything in detail and the real cost to the client (side not, the plan was to refi them later which we plan on doing in a couple of months).
#16: If you are veteran, first responder, medical profession- the great sounding program (Homes for Heroes is the largest one) where you get money back isn't as great as it sounds. I promise you. The realtor part of it is actually a good deal for you but the lender side where they typically pay for your appraisal (around $400-600) is likely costing you a ton of money in the rate and cost of the loan. These are usually retail lenders who have lot's of extra cash (there is a reason why they have to charge higher rates and fees/origination) that pay into these programs, which are relatively expensive (for a lender about $1800 a year for Homes for Heroes just to be part of their program and that is it). You can still shop the lender. DO SO!
#17: First time home buyer programs are usually marketing schemes. There are some benefits offered if you are doing a conventional loan which anyone can have access to. Other things are usually the DPA programs (see #15) and should be avoided. Your third cousins best friend's dog's breeders brother who got $10K free money to buy a home is more times than not money that cost them.
#18: Most loans over 80% loan to value that doesn't have mortgage insurance is costing you in a higher rate. If you are doing conventional loan, you can get rid of the MI later. If it is baked into the rate it is there for life of the loan.
#19: FOR THE LOVE OF GOD AND ALL THAT IS HOLY if you are building a home PLEASE understand that the builders preferred lender that they are going to give you $10K in free upgrades for using them is going to cost you much more money than the $10K they are 'giving' you. Here is how this scheme works. The free upgrades actually are going to cost them maybe $2K if that to do. In return for you using their preferred lender and getting absolutely bent over they are going to get a nice big fat check worth alot more money. The builder and the lender will laugh at you sitting in the model house counting your money you just forked over as they watch you move in.
#20: A realtors 'preferred lender' can be good or can be bad. There is no way to tell. Here is how it works in the industry. Retail lenders who tend to charge more have bigger budgets to spend on marketing. They will 'partner' with realtors and pay for the realtors marketing (also sponsor things like their meetings, or holiday party, or conferences or whatever else) and in return the realtor makes them their 'preferred lender' so the realtor will refer you to them when you are not already using a lender. Now, you can also have 'preferred lenders' that don't do that stuff and the realtor has found them to be a good lender. (side note here, in the average realtors eyes, a good realtor is one that closes deals and does it on time and not so much about rate and cost) For example, I am several realtors 'preferred lender' but do not spend money on them and it is really based on them knowing I can get more loans approved, close on time and give their clients great deals. Overall, NEVER get loan advice from a realtor unless they are the rare ones that are licensed for lending and actually know what they are talking about (that is significantly less than 1% of them)
#21: You don't need 20% down. Don't keep waiting to buy when you are spending money away on rent. Every month you pay someone else's mortgage (paying rent) is money you will never see a dime of again. As an owner you are building wealth. Think of it this way... landlords are landlords for a reason. They are not losing money and on top of it are gaining equity. For most Americans, their 'wealth' is almost exclusively in their homes. Not retirement accounts or stocks etc but built up equity from paying down principle and appreciation of their homes which is historically pretty consistently 5% over periods of time (including booms and crashes).
#22: You don't need perfect credit to get a mortgage. You can do a FHA loan with a minimum credit score of 580 with as little as 3.5% down of the purchase price.
#23: When picking a good realtor find out these things about them: A) Do they do this as a full time job or is it a side gig or something they do when they are bored etc. You want a full time realtor for the experience and focus. Trust me. The exception on this would be a semi-retired realtor but honestly, they are usually ones to pass on as well. You want someone who knows the market, is sharp on negotiation and has good contacts. B) How long have they been doing the job. Experience counts for sure. But I rather go with a rookie doing it full time than someone been doing it 10 years as a part time gig. C) What is their availability. You want someone that will be available on your time tables and not theirs. D) How many houses have they sold or closed on? It will give you an idea about how productive they are. But keep in mind, someone who isn't as productive might be hungrier and more flexible to you versus someone who is doing tons of volume.
#24: Always get an inspection done from a good inspector. Do not skimp here. A good inspector will give you very important info on the home even if there is nothing to be concerned over and potentially catch a very big problem. Keep in mind even the best inspectors will not be able to find out anything and everything wrong with a house. Find out of they do mold and radon testing or not and if it is extra if they do. I would go ahead and do it. Keep this in mind, this is usually the largest financial transaction of your life so far. Do you want to be penny wise and dollar foolish on it?
#25: If you are military or a vet. Run away from supposedly veterans lenders like Veterans United and New Day (and more but those are two big ones) THEY SUCK. Even good places like USDAA (who does insurance well), Navy Fed, may do a lot of good for vets in other areas but are not the best in mortgages.
#26: As I will get to soon... brokers are better. This is true for insurance too. I see insurance quotes often and I personally did my own shopping where I shopped 10 carriers plus one insurance broker. The broker easily won out. Plus, the big carriers suck if you end up with a claim. I have a whole personal story about Allstate sucking big hairy monkey balls. On top of it all an agent at a large carrier has NO sway on anything on a claim. A broker actually does (as counter intuitive as that seems) because they can tell the insurer that if they don't do something right that he will not send that insurance company any more business. The captive agent has no choice.
#27: If you are in a rural area, check out a USDA loan. You can finance up to 100% but keep in mind, you actually might end up better served doing a FHA loan depending on specifics.
#28: Brokers are better. They weren't always... they use to be a pack of scumbags and slimballs who would screw over their own mothers for an extra 20 spot. Before 2008 I had plenty of chances to be a broker and would not even though I would have made 3 or 4 times more than I was making because again the vast majority were nastier than moldy dog poo with worms in it. That being said, even back then you could get a better deal from a broker IF you knew what you were doing and could protect yourself. Otherwise, you could get screwed so badly that it would make going to Quicken seem like a good deal. In fact, I actually used a broker on both of my home purchases even though at both times my wife and I worked at banks. That is right, when bankers want to do their loans- you know who they come to? Brokers. Things have changed and really the consumer advocates are now brokers and the things they use to do before that would screw people over are things that can not be done now. Not only are you going to get a better deal at a broker the vast majority of the time but you are also not going to get screwed over. Plus they have options that banks, credit unions and direct lenders don't have to get you approved if you have a harder to finance situation like a business owner, bad credit, recent major credit event (foreclosure, bankruptcy, etc) etc. Also, brokers can close quicker than other lenders on average. How do you find a broker? Well, you can ask me, I know brokers throughout the country. I have no problem connecting you to one (and if you are wondering, by regulation and the risk of losing my license, I can not get paid for referring you to a broker... it is purely out of help you out) or if you want you can check out www.findamortgagebroker.com oh... and if you are in Illinois, I can help you directly.
#29: You are not locked in to a lender with a pre-approval. Unscrupulous lenders who tend to overcharge will have a lot of nasty little tricks that they do to keep you stuck with them. Fear is one of the big ones backed with lies. That fear will be to tell you that you can not change lenders once you have an offer accepted from a pre-approval or you can lose your earnest money. FALSE! Or that you will end up not being able to close on time with another lender (a favorite of retail loan officers to say about brokers when broker turn around times are actually quicker than retail). Your Loan Estimate is provided to assist you as the consumer to not only better understand the true costs of the loan but to be able to shop your loan around or the best options for you and then be able to compare them as close to apples to apples as possible. Don't let liars overcharging you win!
Hope this helps guys. I am always willing to help out if you have any questions or want to connect with someone licensed for your state. Just DM me.
greedygoat
Footballguy
Good lord, finally closed yesterday!!! Every step of the way was a delay but finally across the finish line. I had a HELOC that I wanted to keep on the house and KeyBank stretched out the subordination approval forever and ordered their own 2nd drive-by appraisal for some reason. Lender needed extra time and had talk with them to waive some extra fees they wanted to throw in because the 1st appraisal came in slightly lower than expected as well as my rate lock expired due to all the delays. Title company did a terrible job communicating close date and times.
But all worth it in the end, 2.875% on a 30 year, self escrow, "skipped" 2 payments. Saves me roughly $600 a month when it's all said and done. Thanks @Chadstroma My guy wanted your name to know who referred him, I kept telling him it was a dude I play fantasy football with online which kind of blew his mind a little bit.
Senor Schmutzig
Footballguy
Just heard from my lender who talked to the underwriter today and our loan is next on the list to get reviewed.
My real estate agent just sent over the extension form (the 2nd one we have had to do) as our current extension expires today. I told her to hold off on sending it to the seller in anticipation of getting our approval today. If she sends the extension along with the approval, I'm assuming there is a much higher chance of the seller signing it knowing that it's now under "our" control (mortgage lender, title attorney) versus some nebulous entity.
So if you're into that sort of thing, send me some good ju-ju, karma, prayers, or whatever that this deal isn't going to fall through. It's for a property that I am buying for my parents so it would absolutely suck if the seller decided to look elsewhere.
My real estate agent just sent over the extension form (the 2nd one we have had to do) as our current extension expires today. I told her to hold off on sending it to the seller in anticipation of getting our approval today. If she sends the extension along with the approval, I'm assuming there is a much higher chance of the seller signing it knowing that it's now under "our" control (mortgage lender, title attorney) versus some nebulous entity.
So if you're into that sort of thing, send me some good ju-ju, karma, prayers, or whatever that this deal isn't going to fall through. It's for a property that I am buying for my parents so it would absolutely suck if the seller decided to look elsewhere.
Senor Schmutzig
Footballguy
Seller agreed to extend until 10/5. If we can't get this thing completed by then maybe it just wasn't meant to be. Or the mortgage industry is a complete cluster-####, but I already knew that part.
The_Man
Footballguy
Closed yesterday on a refi. Not one of Chad’s guys - 30-year at 2.99. I still can’t believe how they’re practically giving money away
Been kind of a long road and I’m sure I didn’t get the best deal possible but I still feel good to have gotten it done at all. Took a long time and a lot of hoops to jump through and this couldn’t have been a cleaner deal.
Saved about $400/month and now have a ridiculously low monthly payment which helps a lot with the 2 tuitions we are currently paying
Been kind of a long road and I’m sure I didn’t get the best deal possible but I still feel good to have gotten it done at all. Took a long time and a lot of hoops to jump through and this couldn’t have been a cleaner deal.
Saved about $400/month and now have a ridiculously low monthly payment which helps a lot with the 2 tuitions we are currently paying
Chadstroma
Footballguy
Well.... a couple of FBG's had to explain to their wife where they found this loan officer. That seems to be the harder conversation to have.Buckna said:
Didn't I have the broker connect with you? I usually do that, pass on the FBG info to them to reach out and say good luck. Brokers like to thank the person that refers them to make sure it is known it is appreciated but there is no money exchanged or anything so it doesn't really matter. Just creates good juju within the community of brokers that know each other.
Chadstroma
Footballguy
Right now it is just managing chaos as best as is possible. My stress level is high to say the least.
Chadstroma
Footballguy
The_Man
Footballguy
Waited to hear from him but DC is another world from Baltimore and finally had to move on. Appreciate all your help and insight regardless!Wait.... what now?
Just joking. Congrats!
Chadstroma
Footballguy
Sorry. Bud, you could have reached back out and eithee me follow up or get someone else but in the end sounds like you got taken care of and that is all that matters.
Senor Schmutzig
Footballguy
And......we need to send another clarification letter back to the underwriter to clear 5 MORE conditions since the last time (four of which are brand new and one is for something we have already provided). Needless to say, the word “underwriter” is a swear word in our house right now.
This is the third clarification letter I have had to send. WTF????
The_Man
Footballguy
Wasn’t complaining at all, sorry if it sounded that way. I appreciate your efforts and insight, and all that you’ve done for so many people here
Chadstroma
Footballguy
No, I didn't take it like that at all. I just expect that when I refer something to a fellow broker that the person will be taken care of. I don't follow up or anything. All of us are silly busy but still. If I refer you to someone and they don't reach out, absolutely let me know so I can either follow up with them and slap them upside the head or refer you to someone else. But again just glad you got taken care of.
The Z Machine
Footballguy
Rate locked at 18 years with 2.75%. Appraisal waived. Just submitted the disclosures... let's see how long this takes to get done.
beef
Footballguy
FishNSuds
Footballguy
Rookie. I think I sent three in one day last week.And......we need to send another clarification letter back to the underwriter to clear 5 MORE conditions since the last time (four of which are brand new and one is for something we have already provided). Needless to say, the word “underwriter” is a swear word in our house right now.
This is the third clarification letter I have had to send. WTF????
Why was your paycheck so big? Probably because i get paid quarterly like I mentioned in the last letter.
Where is xyz HELCO go? I sold the home was I why I sent you the CD yesterday.
Where did you get the money to pay off the HELOC? Sold the home.
What did you spend $20k on last week? Downpayment on a load closed with you 2 weeks ago.
It never ends............
Senor Schmutzig
Footballguy
Well it better ####### end because I was able to wrangle the 2nd extension on the closing but it will be the last if I can get this #### closed in the next 10 days.
Ridiculous.
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Chadstroma - I am getting some bathroom work done in my condo over the next few weeks and am not moving anytime soon. I did re-fi in January down to 3.12% on a 15 year mortgage and have paid off about $6-$7K since on the beginning balance. Combined with maybe increasing the worth of the condo with the updated bathrooms, what are your thoughts on looking into another re-fi? I would only want 15 years, hopefully under 3, etc. Let me know if you need anything else to, high level, understand my situation.
Thank you!!!!
Chadstroma
Footballguy
Should have a good chance of something that makes sense. Shoot me a PM with the expected value, current balance, and zip code. I can see what I would you to get and make an intro to someone to help as needed.cubd8 said:
fruity pebbles
Footballguy
Keep hearing about how much mortgage lending has tightened and banks don’t really want to loan money right now. Is that what you guys are seeing? Can you still get a low rate mortgage with 10% or less down and a good credit score?
Chadstroma
Footballguy
Yes, abso-freaking-lutely. Most of the loans I do are 3-5% down.
Banks have got silly. Chase is the poster child for that. I think they raised it to a min credit score of 700 and 20% down which is down right silly. That being said, Dimon (Chase CEO) has long not wanted mortgages. They basically have the approach of "We really don't want to do mortgage loans but people expect us to do mortgages so we will do them and get a nice margin for ourselves if you don't know any better". That is the extreme but banks have long been tighter on underwriting before COVID and tightened way up.
Things in general got a little tighter for those with good credit but mostly for business owners. For W2 employees, there really isn't much difference now than there was before COVID, other than lenders being crazy busy.
The key is first- don't go to silly places for your mortgage. The second is that if you have good credit then the doors are wide open for you.
Senor Schmutzig
Footballguy
With the caveat that it's still going to take a ####-ton of time to get something completed, regardless of your credit score.Chadstroma said:
- The guy with an 800+ credit score just trying to secure a $100k mortgage that has been sitting in underwriting for 7+ weeks
Leeroy Jenkins
Footballguy
I am thinking of doing a cash-out refi or credit facility in order to potentially renovate 1-2 bathrooms and the backyard. I am only 5 years into a 30yr mortgage with 3.65% rate, but there is some equity here to pull-out for sure. Credit score is over 800.
Thoughts on how to best proceed?
Thoughts on how to best proceed?
Chadstroma
Footballguy
It depends. It depends on the lender, the loan type, and third party issues. But yes, pretty much everything is taking forever. (You must be trying to clear conditions now... if it was 7 weeks in UW that would be insane)
Most lenders are struggling turn time wise. I have one lender that is still pretty quick. I have a couple that can make a 30 day contract on purchase. Then from there it is slow, slower and downright ugly nasty.
For the loan type- your first thing is purchase vs refi. Purchase generally is quicker. Past that- if you are doing something like a renovation loan etc I am avoiding those right now and advising clients against even considering those.
Working with others in what I call the "lending ecosystem" is the biggest issue for me right now. Things like subordinations, payoffs, appraisal, etc are taking much longer than normal. Title companies have been killing me on purchase transactions recently. Basically ignoring us when begging for docs/communication and then getting us the docs we need the morning of the closing and then blaming us for not having the docs ready to close.
Chadstroma
Footballguy
Depending on how much you want to get out for cash versus how much you currently owe you may want to do a HELOC (I assume that is what you referred to with a credit facility?). A cash out refi will be higher than just a refi. You would want to just compare what is available to you from refi and then getting a HELOC for the remodel or just doing a cash out. There is no automatic correct answer here, it will depend on the numbers.
Leeroy Jenkins
Footballguy
I was going to reach out to my current lender as well as another source and compare what is available to me. If I can borrow 80% of value, I can probably net out $75-$100k before fees. I just want to keep my payment the same and see what proceeds are available.
I filled out a form on lendingtree a while back just to see what was out there, and I was inundated with calls for weeks. One broker still emails me, who has a local office. I never replied to any of them because I was just looking for general information, and the salesy calls were gross.
Chadstroma
Footballguy
Yea... bad move on Lendingtree or anything like it. Avoid. You will be tempted to get a new phone number for a couple of weeks.
Feel free to PM me your info and I can connect you to a broker in your state.
Otis
Footballguy
I knocked out a $700k mortgage on a second home from application to closing in about 6 weeks. And at 3%. I’m like a mortgage superhero.
Nigel
Footballguy
I've got 11.5 years and $180K left on a 15 yr at 3.65, very good credit and ~80% equity. I'd love to refi and knock a year (or more?) off. My nephew is new to the mortgage business so trying to throw him a bone and go through him. He says there is no difference in the rate for 10 yrs vs 15, so the play might be to refi at 15 and continue to make same payments we make on current loan, paying off early and being done sooner than if we stick with current loan. Does this make sense? Still not clear to me how yet much time we'd save. Current payment is around $1600 P&I, $2,700 total. I've messed around with calculators but not sure how to figure out how soon we'll be done if we refi $180K at say 2.65% for 15 yrs, but continue paying $2,700/mo. Can anyone easily calculate that for me? TIA
Ignoratio Elenchi
Footballguy
It's a hard knock life my friend.
:Kinda jealous, but not too much knowing how much you work:
