View Full Version : Mortgages: Cash Flow Programs vs. ARMS
peace
05-24-2005, 01:58 PM
I have a question.
1) One co-worker here said he got a 5/1 ARM with a lender that has 4 payment options, with no pre-payment penalties.
2)Does anyone participate in a chevy chase cash flow program? One loan officer told me that the risk is 2% being added to your loan amount. For the cash flow program, how much would I have to overpay (to principal) each month to avoid the 2% being added each year to my loan amount? Are there ways around it?
I don't want to have my loan amount increase yearly.
3) How many people have actually seen that their good faith estimate (GFE) looked right on target w/ actual costs or were the GFE completely off?
4) How much are property taxes in Loudoun county right now for a new townhouse?
5) Don't you end up paying more by using the builder's preferred lender?
6) Does it really affect my credit score a lot if I get it checked by many different loan officers? Haven't gotten to do all of it in 14 days. Folks have told me that if its in 2 weeks then it counts as 1 credit check. Intercoastal said we would have to keep a high credit score til the end of the year.
Thank you so much for everything =)
Sunny
05-24-2005, 02:30 PM
quote:Originally posted by peace
I have a question.
1) One co-worker here said he got a 5/1 ARM with a lender that has 4 payment options, with no pre-payment penalties.
2)Does anyone participate in a chevy chase cash flow program? One loan officer told me that the risk is 2% being added to your loan amount. For the cash flow program, how much would I have to overpay (to principal) each month to avoid the 2% being added each year to my loan amount? Are there ways around it?
I don't want to have my loan amount increase yearly.
3) How many people have actually seen that their good faith estimate (GFE) looked right on target w/ actual costs or were the GFE completely off?
4) How much are property taxes in Loudoun county right now for a new townhouse?
5) Don't you end up paying more by using the builder's preferred lender?
6) Does it really affect my credit score a lot if I get it checked by many different loan officers? Haven't gotten to do all of it in 14 days. Folks have told me that if its in 2 weeks then it counts as 1 credit check. Intercoastal said we would have to keep a high credit score til the end of the year.
Thank you so much for everything =)
I have a good friend who would be happy to help you- just email him this set of questions at willisn@williscentral.net His name is Nate and he is an authority on the subject!
Also, my husband just emailed me this article yesterday- you might find it interesting...
SALEM, Ore. (CNN/Money) – The American spirit of "buy now and pay later" – or never – has been a driving force behind this unprecedented housing market.
Gone are the days of saving a hefty down payment and striving to pay off your house in 30 years. Today, the typical first-time home buyer or vacation-home buyer might finance the entire cost of the house and pay only the interest owed on the loan for the first several years.
The latest option? A monthly "minimum payment" that doesn't even cover the interest.
Such innovations have, no doubt, been a boon to buyers who might have otherwise spent years socking away a down payment or paid a premium for a 30-year fixed-rate loan on a house they planned to own less than five years. And judging by historically low default rates, homeowners have been able to handle their growing debt burdens.
Then again, buyers have been experimenting with more aggressive financing in the best of all times, when interest rates remain low and home prices continue to appreciate.
"Mortgage markets have been so flush with cash that home buyers are able to layer one risk on top of the other," said Keith Gumbinger, vice president of HSH Associates. "It's possible to borrow more than the value of the home, put in no money of your own and pay a minimum monthly payment."
What's the worst that can happen, you ask? Consider the danger with three increasingly popular loan structures.
'Piggyback' loans
The 20-percent down payment, once the first hurdle to homeownership, is now the exception rather than the rule. According to a recent survey by the National Association of Realtors, in fact, 25 percent of all buyers financed 100 percent of the purchase price, and 42 percent of first-time home buyers bought with no money down.
Though small down payments are the norm, borrowers with less than 20 percent to put down must either pay private mortgage insurance or borrow their down payment using a home equity loan or line of credit.
Most choose the latter option, also known as a "piggyback" loan. That makes sense if you can afford to make your regular mortgage payment and pay more than the minimum owed on this loan.
The danger: A home equity line of credit, which is the most common such loan, carries a variable rate and has no fixed payment schedule. If you make only the minimum payment, the balance of this loan will remain the same. What's more, the interest you pay is immediately affected when the Federal Reserve raises short-term interest rates.
Interest only loans
As the name suggests, an interest only loan requires that you pay only the interest due on the loan for the first five, 10 or 15 years of the loan. It's a popular option in areas where high home prices have made it tough for buyers to afford monthly payments that include principal and interest.
According to R.J. Arnett, executive vice president of national wholesale lending forMortgageIT, an interest-only loan makes sense for first-time buyers whose incomes will likely go up in the next few years or investors who don't want to commit to paying principal every month -- but could afford to pay the higher amount if needed.
"If you're the gambling sort, you could get into an interest-only product and bet that the market will build equity for you," said Gumbinger, explaining that paying down principal is not as much of a concern for people with shorter time horizons, particularly if home prices are going up.
The danger: Homeowners who are using these loans to buy more house than they can afford could get into serious trouble if they don't budget for higher payments down the road. There's no a guarantee that prices will appreciate. And if you stay in the house longer than you planned, your monthly payment jumps drastically after your interest-only honeymoon period.
The 'minimum payment' option
The mortgage du jour -- which is marketed as a cash flow ARM, option ARM or flex ARM -- gives borrowers three or four payment choices each month.
They can pay the old-fashioned principal and interest of a 30-year loan.
They can pay only the interest due.
Or, they can make a "minimum payment" and add the rest of the interest they owe to the balance of the loan.
Lenders put a limit on how much interest borrowers can pile onto their loan. Still, borrowers who consistently pay the minimum will see the balance of their loan go up rather than down over time.
"Traditional banker that I am I didn't think there would be much interest in this product," said Anthony Hsieh, president of LendingTree.com, referring to the payment option his company rolled out in February. "But consumers have loved it."
Still, Hsieh cautions that this not the best bet for everyone. "If you have seasonal income or are self-employed with monthly income that is inconsistent, this loan may be great for you," he said. "You can pay the minimum monthly payment a few times per year, but catch up by making extra principal reduction in months when your income is higher."
If, however, you're using such a loan to push the limits on how much you can afford, you could be setting yourself up for trouble.
The danger: "Not only do you not own any of your home, but you may be piling up additional debts that could quickly exceed the value of the home," said Gumbinger, adding that the interest rates on these loans adjust every one to three months. "There are no guarantees that rates will remain at comfortable levels and no guarantee that home prices will continue to go up."
"You could find yourself in a rather uncomfortable circumstance," he said.
peace
05-24-2005, 03:07 PM
Interesting. what type of loan did you try?
Has anyone used a refinance with no closing costs? What are the advantages/disadvantages?
Sunny
05-24-2005, 05:19 PM
quote:Originally posted by peace
Interesting. what type of loan did you try?
Has anyone used a refinance with no closing costs? What are the advantages/disadvantages?
None of them! We have a 30-year fixed and are quite happy with it. My husband sent it as a sort of "I told you so" to me.
Neighbor
05-24-2005, 06:53 PM
The best loan out there is with Pentagon Federal Credit Union. Today the 5/1 jumbo is 4.375 with 0pts. I have looked around for a long time and the rates are still the best I have seen. That being said, you might do better if you use a builders lender if they play the game and compete with serious incentives. Our builder (VM) offered to take about 12K off the sale price if we used their lender. That really compensates for the other lenders lower rates (taking into account my circumstances). Anyway, check out the site an I would challange anyone to show me lower published rates. Trust me, I am a member of at least 5 credit unions and Penfed is the best by far. Navy FCU, NSF FCU, Treas. Dept FCU, can not compete.
Here is the link:
https://www.penfed.org/productsAndRates/mortgages/firstMortgageLoans.asp
SoxFan
05-24-2005, 07:36 PM
Sunny...thanks for posting that article. Great info.
peace
05-24-2005, 08:33 PM
Thank you for all the responses. I'll have to look at the Penta.
I feel like I have to decide by next week if I want to use the builder's preferred lender because we have decide our design center options. They are offering the gourmet kitchen, countertop and an allowance for the design center, but not 12K off the sale price. That's amazing, when did VM offer that? for single family home only?
Pentagon Federal has restriction on who can be members. Same with Navy Federal. Anything with "Federal" probably means you must be a federal govenment employee or somehow work for the govenment. Mortgage brokers can be good since they seek rates from several sources for the best deals. From my experience there are LOTS of options for mortgages. Some are very creative. GFE is just that, an estimate. It will be close to maybe several hundred dollars. All depends on what interest rate you close on. Co tax can be found on the Loudoun Co website. I forgot the url, just search for it. If you're buying a resale, you can lookup what the previous owner paid in taxes. You MAY pay slightly more buy using the builder's lender but the cash you get might offset the extra amount over a short period of time like an ARM. I did this and got $5k off closing. The type of credit checks will matter like car dealerships and credit card inquiry. Just don't go car shopping until you get your mortgage. Lien, suits, and judgements will be more of a weight than credit inquiries.
I see you ended up with a Van Metre TH. Intercoastal is a small mortgage company thats trying to make a name for itself in this area. They are a company created by Van Metre. My experience is they usually don't have the best rates. Service was fine except towards the closing date when I felt they became a little unorganized. Not really a problem for me since I was doing a refi and getting some $$$ for a condo I bought since they were one of the prefer lender.
-Teak
Carol Al-Ajroush
05-25-2005, 07:25 AM
Northwest Federal Credit Union, although having federal in the name is opened up to non-federal employees (see the list of member companies/organizations on the web site to determine if you are eligible). It is worth checking into:
http://www.northwestfcu.org/
FYI - I believe the "federal" refers to Credit Unions being chartered under the federal gov't. That said, most credit unions have some sort of affiliation requirement for membership.
Pam D.
Neighbor
05-25-2005, 08:55 AM
True, you must be a member. However anyone can join Pentagon Federal Credit Union. When you call, just ask to join their Millitary Family Organization Newsletter. That gets you in, and the rates are the best. Have you looked at their lender fees. NONE! Blows the doors off any lender I have seen.
quote:Pentagon Federal has restriction on who can be members. Same with Navy Federal. Anything with "Federal" probably means you must be a federal govenment employee or somehow work for the govenment.
Neighbor
05-25-2005, 09:00 AM
I just looked at Northwest Federal Credit Union. They look horrible.
http://www.northwestfcu.org/mortgages/rates.htm
The 5/1 is 5.375 almost a point higher than Penfed.
peace
05-25-2005, 09:36 AM
Is there any cost to join the pentagon fed.credit union?
PEACE;
I bought a Van Metre and used Intercoastal bc of the incentives. They didnt have the best rates but not the worst either. My sales person said if we went with them i could get 12k off the sale or 10k off the closing cost. I chose the latter and used some of that money towards pts to lower my rate.
gammonbabe
05-25-2005, 11:27 AM
To learn about mortgages go to our website:
http://www.freddiemac.com/corporate/buyown/english/mortgages/what_is/
There are many options in the market today, and different lenders offer different products. Make sure the product you pick is something you can live with not just today, but 5 years down the road. Also beware of mortgage brokers offering deals that sound too good to be true ... they usually are. If you go with the broker that the builder uses you can always refinance later with a product that suits your needs better.
There are many reputable lenders with many different products, Provident, Wells Fargo, and Bank of America are just some of the big dogs.
Marianne
Hey Just checked out the Pent Fed link. The rates look good on the 5/1 arm but 4.375 with zero points. The APR looks kinda high at 5.492 which is supposed to be what ur actually paying w all the fees and points together. And for a zero pts that looks off, they gotta get u somewhere....
peace
05-25-2005, 12:04 PM
Is that incentive for 10K and 12K just for single family home? That's a lot, does that include design center options?
We bought a townhouse.
Neighbor
05-25-2005, 12:58 PM
quote:Originally posted by Thu
Hey Just checked out the Pent Fed link. The rates look good on the 5/1 arm but 4.375 with zero points. The APR looks kinda high at 5.492 which is supposed to be what ur actually paying w all the fees and points together. And for a zero pts that looks off, they gotta get u somewhere....
That is the correct rate. No they do not "get" you anywhere. That would be illegal. Moreover, did you compare the closing costs? Pen Fed has practically none. I have been tracking rates and loans for a long time and you can’t beat the rates and fees. Most people go with the higher rate lenders because they feel more comfortable with their builders’ lender. But hey, in the long run they are just taking your money.
Pats_fan
05-25-2005, 01:29 PM
quote:Originally posted by Neighbor
quote:Originally posted by Thu
Hey Just checked out the Pent Fed link. The rates look good on the 5/1 arm but 4.375 with zero points. The APR looks kinda high at 5.492 which is supposed to be what ur actually paying w all the fees and points together. And for a zero pts that looks off, they gotta get u somewhere....
That is the correct rate. No they do not "get" you anywhere. That would be illegal. Moreover, did you compare the closing costs? Pen Fed has practically none. I have been tracking rates and loans for a long time and you can’t beat the rates and fees. Most people go with the higher rate lenders because they feel more comfortable with their builders’ lender. But hey, in the long run they are just taking your money.
Neighbor, based on this link: http://www.answers.com/topic/annual-percentage-rate , I would have to disagree with you. I am just learning this myself, but it would appear that the "interest rate" is really not the measure of what you pay the lender. The APR is a better indicator, and PFCU's APR's are pretty comparable to those of everyone else.
Exactly, a high APR is an indicator that theres fees built in somewhere. And i have spoken to loan officers and they are the ones pointing this out.
As for the incentive, i bought a courtyards home in march 2005. Single family home.
Heres some info i found about interest rates and apr on ING website.
Why are the APR and Interest Rate different?
Here's a quick lesson. The government requires us, and all banks, to report both the Interest Rate and the Annual Percentage Rate on a loan. That's a good thing. We think consumers should know exactly what they are being charged but sometimes it gets confusing. So what's the difference between interest rate and APR?
The Interest Rate is the rate used to calculate the interest that you will pay on the loan. The Interest Rate on the Orange Mortgage is adjustable after 3, 5 or 7 years (depending on the term you choose) so the rate will most likely change over time. It may go up or down depending on market conditions. The Annual Percentage Rate, or APR, starts with the Interest Rate and then adds in other costs such as points and other fees that, along with interest, are called "finance charges". Generally, APRs are higher than Interest Rates because all finance charges, not just interest, are used to calculate the APR. This lets you see the true cost of borrowing so that banks can't hide behind a low rate and pile on fees and points that you may not realize add to the cost of the loan. When deciding between loan choices, be sure to pay attention to the APR and the "rate."
peace
05-25-2005, 04:35 PM
Do you use Northwest? http://www.northwestfcu.org
Do you guys use Pen Fed? https://www.penfed.org
Do they sell your loan and then you're not sure who to make your payment to?
What are your loan experiences?
How much does refinancing usually cost (if we go w/ builder's lender and refinance right after?) ?
Are there any no closing cost refinancing programs?
Neighbor
05-25-2005, 09:01 PM
(From the PenFed website)
The Federal Truth in Lending law requires that all financial institutions disclose the APR when they advertise a rate. The APR is designed to present the actual cost of obtaining financing, by requiring that some, but not all, closing fees are included in the APR calculation. These fees in addition to the interest rate determine the estimated cost of financing over the full term of the loan. Since most people do not keep the mortgage for the entire loan term, it may be misleading to spread the effect of some of these up front costs over the entire loan term.
Also, unfortunately, the APR doesn't include all the closing fees and lenders are allowed to interpret which fees they include. Fees for things like appraisals, title work, and document preparation are not included even though you'll probably have to pay them.
For adjustable rate mortgages, the APR can be even more confusing. Since no one knows exactly what market conditions will be in the future, assumptions must be made regarding future rate adjustments.
You can use the APR as a guideline to shop for loans but you should not depend solely on the APR in choosing the loan program that's best for you. Look at total fees, possible rate adjustments in the future if you're comparing adjustable rate mortgages, and consider the length of time that you plan on having the mortgage.
Don't forget that the APR is an effective interest rate--not the actual interest rate. Your monthly payments will be based on the actual interest rate, the amount you borrow, and the term of your loan.
[/quote]Neighbor, based on this link: http://www.answers.com/topic/annual-percentage-rate , I would have to disagree with you. I am just learning this myself, but it would appear that the "interest rate" is really not the measure of what you pay the lender. The APR is a better indicator, and PFCU's APR's are pretty comparable to those of everyone else.
[/quote]
Neighbor
05-25-2005, 09:04 PM
The important language is: you should not depend solely on the APR in choosing the loan program that's best for you!
The APR is a hypothetical rate. You must go by the actual rate. They do not use the APR for calculating payment.
loudoun_terp
06-08-2005, 05:48 PM
peace,
Our mortgage broker works with over 350 lenders, including the large banks such as Wells Fargo and Countrywide among others, and can help to get you the most competitive rates based on your objectives. As others have stated, the whole mortgage industry has changed with the low interest rates in recent years, and now offer many different programs to fit your needs. With the many choices, also can lead to confusion for the consumer. Brokers get wholesale interest rate, so its better than going straight to the lender. If you need any help, just email me at tim_nguyen9@yahoo.com
boomertsfx
06-09-2005, 08:20 AM
pentagon fed has decent rates, but their 30yr jumbo is 5.907APR... my CU (apple federal) has the 30yr for 5.629% I think apple is for school teachers and families, etc...
Tim, how much do brokers usually charge for their part of the deal? I presume they get a kickback from whatever bank they steer the customer to? Do they also charge the customer points? Wouldn't that negate any "wholesale" advantage? It seems to me mortgage brokers might be a better option for people that are not very savvy or are used to doing things the old-fashioned way. Just my 0.02$
loudoun_terp
06-09-2005, 12:11 PM
boomertsfx,
Mortgage brokers rates will always beat the bank's rates PERIOD. There is a small spread built into the wholesale interest rate already, but offered rates still are lower than retail rates. Brokers also have access to multiple lenders that have multiple programs, which means choice of programs and competitive rates. For example, if you walk into a Bank of America, your choice is only BOA.
Points are always negotiable. The broker's job is to give available options, so in the end it will be a win-win situation for everyone.
Keep in mind that you don't know what company/s you will end up with at first. Although generally it doesn't matter, I am currently having a really hard time trying to fix a problem that occured when the company to whom Intercoastal sold my mortgage resold it again (and didn't include the principal I had paid them in the balance transfer). These huge mortgage companies leave a lot to be desired in the customer service department.
I don't know if Credit Unions resell mortgages, or if you can expect to stay with them...
Pam D.
Neighbor
06-09-2005, 03:17 PM
Pen Fed has not sold my loans.
Brokers rates may beat bank rates, but CU's probably beat them all. I doubt a broker can "negotiate" points when the competition is offering a 5/1 Jumbo for 4.375 ZERO points and waived closing costs. No I do not work for PenFed, I just have shopped around and done years of research.
SNIP from https://www.penfed.org/productsAndRates/mortgages/closingCosts.asp
For a limited time, we will pay many of the fees you would pay other lenders.*
Apply now for a new mortgage and we will waive:
Processing Fee
Underwriting Fee
Application Fee
Credit Report Fee
Appraisal fee
Tax Service Fee
Flood Certification Fee
Closing Fee**
Free 90 day rate Lock!
Anyone got a better published rate from a reputable lender?
golfnut
06-09-2005, 03:48 PM
Hey Lefty- shouldn't you be studying for the bar??? :D I didn't know you were so knowledgeable about mortgages!
quote:Originally posted by Neighbor
Pen Fed has not sold my loans.
Brokers rates may beat bank rates, but CU's probably beat them all. I doubt a broker can "negotiate" points when the competition is offering a 5/1 Jumbo for 4.375 ZERO points and waived closing costs. No I do not work for PenFed, I just have shopped around and done years of research.
SNIP from https://www.penfed.org/productsAndRates/mortgages/closingCosts.asp
For a limited time, we will pay many of the fees you would pay other lenders.*
Apply now for a new mortgage and we will waive:
Processing Fee
Underwriting Fee
Application Fee
Credit Report Fee
Appraisal fee
Tax Service Fee
Flood Certification Fee
Closing Fee**
Free 90 day rate Lock!
Anyone got a better published rate from a reputable lender?
loudoun_terp
06-09-2005, 04:41 PM
neighbor,
The rates for the 5/1 ARM for conforming and non-conforming (Jumbo) seem to be the same on PenFed's website. This seems odd. Remember when banks are going to give a loan to a homebuyer, they take a look at all the risk they are taking on, including loan amount. In terms of waiving certain fees, just remember there is NO FREE LUNCH. It will almost always be made up somewhere else. Banks are in the business of making money. That's why they give you a low rate of return on your checking/savings and generate revenues by credit cards, mortgages, etc. If someone has been able to take advantage of PenFed's rates, then please come back and share your experience. I took a look at the Fixed loans, and it is just as competitive if not higher than broker rates.
As to points, it is up to the broker to offer different options for the client. It has nothing to do with the broker's wholesale rates with the lender/bank. The spread and rates change every day, sometime multiple times. Points will only affect the bottom line of the broker (commission). Like I said, brokers have room to work with you because they can offer wholesale rates. Yes, rates is very important as a consumer, but I will tell you that a major factor for people these days is that what is what is promised is DELIVERED ON, and is ON TIME. Ever had things changed at the closing table?[:0] Not very funny, huh?
We just closed on a 30-year fixed jumbo from Penfed, no points. They waived the $450 for the appraisal, etc. and the $300 fee for their title company. Leaving us w/ the interest for the first month, escrow, $200 to title co. for title search, plus title insurance and grantee tax (?).
Service was good, friendly, helpful, and the title company comes to your house to close. Plus, they have an online application. Painless.
Pam D.
Neighbor
06-09-2005, 07:13 PM
loudoun_terp,
As for the 5/1 Jumbo and Conforming being the same, it seems to be their "trademark." They have always been the same (for years). They try to keep the Jumbo 5/1 low. Sometimes they offer significantly lower than market rates for the 5/1. (for example I have seen the 5/1 lower than the 3/1). As for the fees, they do not make it up anywhere else. The fees are labeled as such and they must follow the TILA (truth in lending act). As for points, if you offer a 5/1 with the same rate and no points, you will not get a commission? How can you compete with that? The only way that I have ever seen a lender compete is if they are linked to the builder and the builder offers a kickback to the buyer with a breakeven way down the road. In other words, the lender would have to offer a huge incentive. Trust me, these $4500 kickbacks are not enough. You figure even 1 point on $450,000. is $4500 and zap there goes your incentive. Unless you are buying condo, your loan amount will probably be more than $450K. I hope that people educate themselves before making the biggest purchase of their lives. No need to spend additional money on some brokers commission.
Neighbor
06-09-2005, 07:15 PM
pamD, glad I could help :-)
Actually, we had already applied for the loan before this thread started... we already recognized a good thing. Just wish we hadn't locked, because it went down and then back up again.
Edited to add: We also have our car loans with them... good stuff all around.
Pam D.
loudoun_terp
06-10-2005, 12:07 PM
pamD,
Thanks for reporting back on PenFed program. It is a very good rate, and your application was probably very strong. Not everyone is in the same situation as you.
neighbor,
There's no need to go back and forth on these discussions. After all, it's your money and you should do with what you are comfortable. You don't work for PenFed? Can we see your W-2?;) Just kidding! Bottom line, if the broker will not eat any commission, then it WILL be the lender.
loudoun_terp
06-10-2005, 12:17 PM
neighbor,
To reiterate, points are optional and some commission is already built into the spread (part of the Rate being offered). Anyone can opt for a no point rate, but it will be slightly higher.
And yes, builders do offer incentives if you go with their lender. They don't always disclose that their "preferred" lender is part of their same company, specializing in mortgages. If the builder incentives are good enough, then take it. But realize, that builders already make a lot of money from the homebuyer, so the closing incentives are false money. They just want us to think that the incentives is something they're throwing in for free.[8D]
loudoun_terp
06-10-2005, 01:45 PM
pamD,
What rate did you get for your Jumbo 30year Fix at PenFed.
We got 5.875. Could be better, but it worked for us.
Pam D.
Neighbor
06-10-2005, 03:52 PM
quote:Originally posted by loudoun_terp
neighbor,
And yes, builders do offer incentives if you go with their lender. They don't always disclose that their "preferred" lender is part of their same company, specializing in mortgages. If the builder incentives are good enough, then take it. But realize, that builders already make a lot of money from the homebuyer, so the closing incentives are false money. They just want us to think that the incentives is something they're throwing in for free.[8D]
Sense any make this doesn’t. If you don't take the incentive you pay X for your house (regardless of how much the builder "makes"). If you take the incentive you pay X-Y(incentive). What you say, is completely irrelevant to the buyer. Who cares how much the builder makes (especially in today's market). In Broadlands they have waiting lists for homes. Anyway, if you take the incentive you take cash right off the sale price of the home. If you don't take it, the builder doesn't say... "ya know Tim, we make enough money as a builder, how about we just knock the price a little lower for you." So, I ask you, what in the world is "false money?"
loudoun_terp
06-10-2005, 05:41 PM
neighbor,
No need to keep arguing this point back and forth. I'm just pointing out how the builder is marketing their closing incentives and how it affects their bottom line. This will make it attractive to go with their lender. Most of the time, the builder incentive is towards closing cost and sometimes even options, right? Not the base price of the model you are choosing. As to the options, they make a very high overhead anyways. You should study the builder industry and you will find out. Like I said, if the incentives makes sense, then please by all means go with it.
loudoun_terp
06-13-2005, 11:30 AM
I should stop debating with a future lawyer...:D
quote:Originally posted by golfnut
Hey Lefty- shouldn't you be studying for the bar??? :D I didn't know you were so knowledgeable about mortgages!
quote:Originally posted by Neighbor
Pen Fed has not sold my loans.
Brokers rates may beat bank rates, but CU's probably beat them all. I doubt a broker can "negotiate" points when the competition is offering a 5/1 Jumbo for 4.375 ZERO points and waived closing costs. No I do not work for PenFed, I just have shopped around and done years of research.
SNIP from https://www.penfed.org/productsAndRates/mortgages/closingCosts.asp
For a limited time, we will pay many of the fees you would pay other lenders.*
Apply now for a new mortgage and we will waive:
Processing Fee
Underwriting Fee
Application Fee
Credit Report Fee
Appraisal fee
Tax Service Fee
Flood Certification Fee
Closing Fee**
Free 90 day rate Lock!
Anyone got a better published rate from a reputable lender?
vBulletin® v3.8.4, Copyright ©2000-2013, Jelsoft Enterprises Ltd.