Contact us for a home loan pre approval true approval!

Raleigh mortgage broker – Raleigh home loans

Raleigh mortgage broker – Raleigh home loans

A good Raleigh mortgage broker knows that a pre approval is a critical part of the home buying process.  With your pre approval you are asking:

• The seller to remove their home from the market
• The buyer’s agent to spend time and money finding you a home
• Both the buyer and seller time to complete contracts and negotiate

You are also putting yourself at risk of losing money by:

• Losing your due diligence money and earnest money after removing the loan contingency
• Unnecessarily paying for an appraisal
• Unnecessarily paying for a home inspection
• Being forced to extend a lease

A poorly done pre approval hurts everyone in the process.  Do yourself a favor contact us for a complimentary pre approval done right.

North Carolina mortgages – Raleigh VA & FHA experts

Click chart below to watch quick tutorial on how to read this chart

North Carolina mortgage rates – Raleigh mortgage broker

How to Shop Mortgage Rates

View this in 1080 HD by clicking next to “CC” at bottom

   I think your mortgage calculator is broken!

I’m glad you asked!

   FHA has two types of mortgage insurance premiums. Up front and monthly. The combination of the two is what the FHA collects as a reserve to pay for loans that default. We are focusing on up front only.

   The Up Front Mortgage Insurance Premium (UFMIP) currently (September 2010) is 2.25% of the loan amount. 300k- 3.5% = $289,500 x 2.25% = $6,513.75. $6,513.75 + $289,500 = $296,013. Any odd       change is paid as cash at closing.

    This is why a mortgage calculator is a fun toy and not a replacement for a qualified loan officer. I say qualified for a reason: I had a client who told me his buddy got a great deal from this other loan company. The quotes they made were better than anything I saw on rate sheets from banks all over the country so I knew something was wrong.

I called this loan company and acted like one of their customers (sneaky I know!). I asked him the most fundamental question: If my loan should be 289,500 after deducting the down payment, why does your good faith estimate have a higher loan amount? He said I don’t know! I’ll have to check with the underwriter.

And these folks at this bank are closing loans…SCARY!  

Choose one: 

• I want to play with a mortgage calculator
  
•  I want to get the right answer
  

When the chart heads upward it means rates are dropping.

Raleigh mortgages

Why is the mortgage rate advertised always different than the rate I get?

Best way to start this conversation is by telling you that companies want to advertise their absolute lowest rate.  The rate advertised is available however few people meet the minimum requirements to get that low rate.  12 day lock period, 60%LTV 760 FICO score etc.  Often times the loan officer quotes rate without having all of the information necessary to accurately provide a quote.

You should also know that no two borrowers are alike.   If your neighbor got a higher rate than you it doesn’t necessarily mean he/she/they got a bad deal.  Several factors are considered when determining what you get as a final interest rate.  We call these factors: Risk based adjustments.  These adjustments are made based on the amount of risk that is being taken by the lender.

The most common risk based adjustments are:

• Loan to value  
• Debt to Income Ratio  
• Credit Score
  
• State the property is located
  
• Loan amount 
• Combined Loan to Value 
• Escrow waiver  
• Lock period 
• Cash out   

All of these will either raise or lower the cost of your loan. 

*Your neighbor may have had a high debt to income ratio whereas yours was low so that could have raised his interest rate even though you both may have the same credit rating.

Here is an example of what adjustments look like on a mortgage rate sheet

The word Agency means Fannie Mae and Freddie Mac.  These are the companies aka “GSE’s” that buy the loan from your bank.  They impose many of the adjustments you see and end up paying for.

The numbers to the right are what we call “pricing” adjustments, meaning the rate can remain the same but it will cost the customer more or less money to get it.

The numbers you see are in percentages.  Example: .125 means a cost of .125% of the loan amount. A minus sign in front of the number means a credit, so  -.125 means a credit back to the borrower of .125%.

Example:

$200,000 loan amount .125% would be $250 cost to the borrower and  -.125 would be a credit of $250 to the borrower to get the quoted interest rate.

If you have a lot of these adjustments it will push the cost of the rate you are targeting higher or lower.

Rates change throughout the day.  It is not uncommon to have rates change more than once during a workday.  This adds to the reasons why the rate advertised may not be what you get. To ensure our clients get the rate we quote we require a full file before we lock rate.  This is because we shop rates with multiple lenders and we do not charge  “rate lock fees” like many institutions do.

Click on video below to understand how rates change.  Click here to contact me with any questions.