-T-

iTrader: (2)

I remember someone saying that they were a mortgage broker. Here is the deal.

We purchased our house at the time when rates were fairly high. Aug-Sep of 08. Were looking at financing right now. Got a quote and a locked in rate at 4.75% for a 15yr. I'm going to 15 yr so I can pay it off quicker and build our dream house in 6-7yrs. Now, rates have been dropping since we locked in. Can I ask my broker to get me a better rate? Or is it a once locked it's done? I'm not a total idiot when it comes to these things, but haven't really heard of anyone asking for another rate once one is accepted. It doesn't hurt to ask, but then again... They are cutting us a deal on their portion of closing costs due to my wife hooking them up on health insurance. So I don't want to spoil a good deal.

VeryWhiteDevil

iTrader: (9)

I have been in the business since 92 (texas until 2005) and currently working for a lender. Yes, you can ask that broker to lower your rate. If they are a broker, then they are approved with several wholesalers. If rates have dropped more than .25% since you locked, they can negotiate the rate with the current locked lender or they could lock in with another one of the wholesale investors they deal with. I only result to the later if the current lender does not want to negotiate. These two options should be available without any problems.

bamacaddy

iTrader: (1)

I'm no broker and don't wanna speak out of turn, just from experience....I had to re-fi to take advantage of the lower rate, I went from a 20 to a 15 and my payments dropped by $80 a month...win win for me, it never hurts to ask...just make sure your broker isn't tryin to make money on the back end...i.e. getting participation on the interest. I'm sure a more informed person might have more to add, i did used to be a finance mgr tho

bamacaddy

iTrader: (1)

well ****...that reply posted while I was typing, see there's a more informed person for you

big reg

iTrader: (28)

I was a broker before the refi boom ended. You can ask them to look into a lower rate as you are not locked into anything. Also just an FYI, loan origination is not prepaid interest or anything else a broker will tell you. It is money going directly to the brokerage off of which the loan officer is paid their commision. And make sure they do not add any YSP (yield spread points) on the back end. It raises your rate and basically is just the percentage of the loan the broker pockets when they sell your loan to the servicing lender.

mitchntx

iTrader: (14)

Many years ago, I refinanced my home to take advantage of much lower interest rates.

What I didn't realize and didn't know at the time (shame on me) is the refinanced mortgage was an equity mortgage. The company used the equity in my home to pay off the first mortgage and then rolled it all into a single equity loan.

Why is that significant?

I see you are in Texas and Texas law limits home owners to one equity loan and it can be for no more than 50% of the appraised value. So you are severly limited on what you can do with your home equity.

And once it converts to equity, you can't go back till the house sells.

VeryWhiteDevil

iTrader: (9)

to say the broker shouldn't make an origination point or YSP is like saying you should work your 40 hour job for free. if you are not happy with that broker, broker fees, or service for that matter, move on to another. no broker will do the loan for free, but you need to make sure it is the best deal for you.

onebadcad

iTrader: (1)

I been in biz since 1989, rates have dropped in the past three weeks. A broker will probably negotiate a lower rate than your original lock if you threaten to go elsewhere-he can also 'yank' your file from whomever he locked with and take the loan to another Lender, thus lock your rate anew with them based on today's rate. You can get a better rate today, so just tell him you want such, remember my rates are based on FL loans, so it may differ in TX:

15-year fixed-assumes no-cash out refinance, with an escrow account and 740+ middle credit score, and 30-day lock period:

4.250%, at this rate Lender pays broker about 1.25 to 1.50% of loan amount, so you should only pay Underwriting and Processing Fee, with No Points, No Discount, No Origination and No Broker Fee
4.125%, at this rate you may be asked to pay 1.00% fee of loan amount with Underwritng Fee and Processing Fee, as Lender is paying broker about .25% to .50% of loan amount

Most banks and brokers try to get about 1.00% to 1.50% of loan amount as revenue, a higher pursuit usually leaves them non-competitive.

onebadcad

iTrader: (1)

Agreed!!! YSP is not a fee that customers pay, it is a payment from the lender to the broker for getting the customer to agree to a rate above par pricing--consumers are always advised prior to spending money on an appraisal their loan amount, rate, payment and costs, if they do not like them, negotiate or go elsewhere, brokers are bound to deliver the provided terms, these cannot be changed once a customer agrees to them, nor can the broker make a single penny more than disclosed initially. Many loans done today in the Broker World have No Points, No Origination Charge, No Discount Points, No Processing Fees and No Broker Fees, thus customer has less closing costs, and a lower APR. Mortgage financing is not only about rate, it is about the APR, and the ability to receive YSP from Lenders instead of charging customers higher fees is very popular, especially when consumers only hold mortgages for an average of 3-4 years. Most banks do not have this flexibility, customers pay a higher rate than a broker would charge and also have to pay at least one point. Banks and the Government despise YSP, why, because it makes smaller entities competitive. Banks, who want to control lending DO NOT CHARGE EVERY CUSTOMER THE SAME RATE, THEY MAKE YSP, THEY JUST DO NOT DISCLOSE IT BECAUSE THEY HAVE HUGE LOBBYISTS. Go to a car dealership, many different financing rates are availabe from various sources, each try to maximize revenue by offering differing rates, same as the mortgage business, but no one has raised hell as they do with YSP in the mortgage industry, why???-because banks/large companies have monopolized auto financing.

Mortgage brokers exist because they are usually able to offer both LOWER FEES AND LOWER RATES THAN MOST BANKS, if not true, there would be none. I beat every bank every day, it is how I stay in business.

IMO, Brokers will be forced out over the next couple of years, the Gov and the Bankers want such, as Brokers, in their media campaign are the reason the World's Economy blew up----here's a fact for everyone, since the beginning of time a mortgage broker has never approved or funded a loan, the banks and their subsidiary lending arms or companies they partnered with did such, did so with reckless pursuit of profits, trumpheted their new-found profits and paid huge bonuses to employees, always lessening criteria to keep up with the competition, hoping the housing market would never burst, as believed each poorly underwritten loan would pay-off with another refinance or be taken back and sold for at least break-even. Well, we all know how it ended, the Banks got saved with taxpayer money we never had, and the little guys got nutz kicked and it has yet to end,,,

big reg

iTrader: (28)

I agree 100% bud. I was just looking out for a fellow enthusiast. Trust me when I was in the business I would attempt to sell every loan at the state cap. I felt bad putting people into 6 month ARM's, killing them in origination to have them come back to me 6 months later with 2 and 3 late payments wanting to lock in a rate. I had to get out as the brokerage I worked for dealt in primarily sub prime lending. I cannot remember a single deal where the buyer did not take cash out or I convinced them to. My conscience got the best of me I guess.

-T-

iTrader: (2)

How does this YSP work? I have initial fees worksheet showing a charge of 3596.18 for ysp. It is then credited back to me from the lender in the sum of funds. But my GFE 2010 work sheet says... Loan origination 5506.18. And then I received a credit for 3596.18 for going with a 4.5% (went lower) and then a final origination charge of 1910. That's the original minus the credit.

VeryWhiteDevil

iTrader: (9)

welcome to Good Faith Estimate 2010!! without seeing the paperwork, it looks like a good deal at the time he locked in.

Goats

Would you say that brokers threw **** at the wall to see what would stick. Did you ever find yourself wondering how in the hell a loan package made it through underwriting back in the hay-day.

onebadcad

iTrader: (1)

If a Lender wanted less documentation or accepted a 500 mid-score borrower, and you had a customer that meet their rules, you sent it to them. The Lender made a premium on the rate/pricing, it was not my responsibility to analyze their business strategy. Wall Street Firms and the Big Banks salivated over the return on these loans, they never thought of the future issues, only today's profit, they begged for more and more loans, always outbiding their competitiors to get a bigger slice of the pie. Utillizing all of the programs available allowed you to be competitive and keep employees paid. It was the responsibility of the Lenders and their investors to judge whether or not the long-term performance of loans would be hindered by the housing market or the economy. Some loans that closed were surprising,,, but brokers never approved them, Lenders did.

onebadcad

iTrader: (1)

The 2010 3-page GFE was mandated by Congress to assist those pursuing a mortgage---guess what, it did not accomplish anything, just created a bigger headache; we see the same as the Gov gets more involved with automobiles and anything else. Ask your Lender to send you the accurate Initial Fees Worksheet, ask the Lender to itemize 'all' of the costs. Fees on a loan do not vary much, as everyone pays about the same for Title Work, and the recording and Gov fees are always the same. The only variance is in the Broker and Lender fees, such as Processing Fee, Underwriting Fee, Points, etc...
With that said, rates have again dropped this week, assuming you have a middle credit score of at least 740, and are not requesting cash proceeds, just a refinance of your current balance, you will probably not see your rate drop an eighth on a point, but your fee should be reduced by about .375%-.500%. For instance, if you were getting 4.250% on 15-year quoted to you last week with .750% points, rate should be the same today but fee should be reduced to .375% of loan amount.

-T-

iTrader: (2)

thanks for the info. I knew someone on here could help me out. Who's in your new avatar?

-T-

iTrader: (2)

Right now we are expected to close on June 7th. My payment is due on June 1st. Do I hold off on the payment and pocket the payment for a gen 3 diff ...? What's the downside of making or not making the June 1 payment?

onebadcad

iTrader: (1)

It is 12 of one, a dozen of the other,,, well almost. If you make the payment before your closing date, your payoff is lessened by the amount of the payment, assuming your were given final loan figures that is utilizing a written payoff from a date prior to you making the payment. If your Lender does not lower the loan amount, thus keeping it at the amount estimated for the refinance payoff and costs before the recent payment was made, you will get the differential in cash three business days after the closing, which is now greater due to your recent payment. If you do not pay, your payoff is higher. Assuming you are doing a rate & term refinance, with no cash-out proceeds, which allows for 2% max incidental cash proceeds, you still get 2% of the loan proceeds three business days after the closing.

Here is what you need to do:
1) Confirm closing for June 7th, with such loan will fund on June 11th, your mortgage should be paid-off by June 14th, most mortgages can be paid as late as the 15th of the month with no late charges, if this is the case you can opt not to make payment
2) If you opt not to make payment, advise your loan officer/broker of such, and also request if you want the loan amount increased to give you 2% of loan amount as cash proceeds at closing
3) Closings, due to processor and third-party errors/delays, sometimes are not predictable, thus you need to make the payment if your loan does not close on the 7th as planned

Again, the short version, if your loan size is set, whether you make payment or not, you net the same cash, as the payment not made increases the payoff, but the payment made lessens the payoff, thus more cash to you from the loan's proceeds.

onebadcad

iTrader: (1)

A new employee I hired., During the initial interview I mentioned I may be printing up some new brochures for the business and she started undressing while stating she has done some modeling at her past jobs,,,

04CTSVMURDERED

I don't see any ring on her finger,... maybe I need to come visit your business and meet her too...