Obtaining a new mortgage loan.

[Sundance Kid]

Just curious, as to what others have done.

In purchasing a new mortgage on a retirement home, my previous experience has been to rely on the judgement and direction, of "The Realtor," handling the sale. I realize, of course, that this plan probably benefits the Mortgage Company and the Realtor, to some extent, to a greater degree than it benefits me. (Saves me time.)

Now, there are numerous on-line mortgage outlets available. I've never considered one before. Always felt, I guess, that they were a guaranteed ripoff.

Would I be better off, to arrange my own financing, by contacting several lendors in the area, where the property is located? Rely on the relationship with the Realtors access to a lendor, or shop on-line, with someone I can't meet face to face?


I'd appreciate any comments on how to pursue this, from people who've been there and done that. Whom, should I consider and which lendors, should I avoid?

Thanks, and Have a Happy Ney Year!

JG

 

[brewer12345]

My experience is that dealing with a broker is a crapshoot: you might get someone honest, or you might get stuffed like the thanksgiving turkey. I finally decided to check out E-trade (who guarantee what your closing costs will be, no "good faith estimate") and if I couldn't beat it I would go with ET. I ended up refinancing with E-trade and I had a good experience with everything happening as advertised. I might possibly have gotten a better deal elsewhere, but I know for sure i didn't get screwed.
I've also heard good things about INGDirect, but they only do certain types of loans, so I couldn't make use of them.

 

[Sundance Kid]

Thanks Brewer, for your reply!! Good Info.!

Guess my question just didn't meet the requirements of this board, for any other response. So,what am I doing wrong?

I'd like to be a part of this forum; I really would! But, you ask a question, that tens of thousands of people have experienced, and you get ONE response----

Think, I'll take my ball and go home. Help Me People, I'm Old and 65 and I need some expert advice! Give me some direction; it's your chance to be Quarterback!

 

[KB]

I used Ditech.com for my last 2 mortgages.
They actually are a front for GMAC mortgage. The rates were good and closing costs comparable to other loans.

It's been about 5 years since I refinanced with them, before they had the flat rate. I couldn't say how conparable they are now.....not too sure about the stability of GMAC at this time too.

 

[Brat]

Hey, I am old too!  Maybe only days younger than you.

I try not to chime in unless I have useful information.  I have never purchased a house, husband and I built the first nail by board.  The second time we used our equity from the first to hire a builder and financed the difference through a mortgage from my  credit union.  If you belong to a credit union ask them what they charge.  I recall Nord commenting that the Pentagon CU has had very good rates a while back.  

I trust mortgage brokers as far as I can throw them.  Banks can be as bad, so I hear.

 

[califdreamer]

Several years back I got a good deal on a refinance with ABN Amro, a big Dutch financial company with an American subsidiary. You can check them out at mortgage.com. It's been a few years but they had the best deal. I just looked at their site. They had a 30 yr fixed @ 6.125% with 2500 or so in costs. I haven't been in the mortgage market lately so I don't know how good a deal that is. It's certainly worth a look.

Also, a friend of mine told me about Catholic Home Loan. It's actually the Catholic Church lending money for mortgages. He told me they had good deals though I wasn't really in the market at the time and didn't look into it.

 

[MasterBlaster]

Mortgage brokers have a somewhat earned reputation of promising low-fee low-interest mortgages and not being able to deliver. They typically call a day or two before closing to inform you that the good loan that you were planning on is not available after all. But that they have another loan with an extra 0.75 percent interest rate and two more closing points plus some extra fees. Don't worry though cause they'll let you finance it all

What the smart people do is arrange with 2 finance firms for financing. The first finance firm is a reliable large regional or national outfit that will deliver a loan but not at the rock bottom fees and interest rates that mortgage brokers promise. The second finance firm is 'Wally the morgage broker' who promises that unbeatable loan. Since you've applied at each when it comes time to close go with Wally if he can deliver otherwise go with the large regional firm. The downside to this approach is that you'll have two appraisal fees and two application fees. But that cost could be nothing compared to closing with a crappy loan product switched in at the last minute.

- Good luck with your loan.

 

[rapoole]

Master-

Your two broker strategy sounds interesting. Have you actually done it?

My experience with mortgage brokers is that they are scum. Promise you anything verbally, then at closing the deal changes, when they have you over a barrel.

My own strategy was to arrive at the mortgage broker's office (large office) with the real estate agent and wife and camp out in the lobby making noise till someone would meet with us. Fortunately I had an email from the offending broker which acknowledged the terms she had promised me. We ended up refinancing on more friendly terms.

rapoole

 

[Mr._johngalt]

This is a slight departure and does not answer the question asked but may be of interest to some.

DW has the "fixer upper" bug (caught it from me??)
In fact, she has an offer
pending as I type these words. You folks know I would love to
do these deals but my time has passed, so I am an unpaid
consultant and "bank of last resort". Here is my point
(yep, I have one). Although she has some real estate
experience, she sees insurmountable problems everywhere,
like with financing. I told her that I could see about 100 ways
for her to handle it (true). She doesn't see them and gets discouraged. I suppose this is why relatively few people
work that side of the RE street. Anyway, good posts here.
With RE financing, you are limited only by your imagination,
or at least that has been my experience.

JG

 

[Martha]

Some of the best rates in our area come from small banks and credit unions. Call around and as what their rates and closing costs are.

 

[maddythebeagle]

Some of the best rates in our area come from small banks and credit unions. Call around and as what their rates and closing costs are.

That was my experience also. I briefly looked at a mortgage broker, but seemed like a used car salesman. Looking at bankrate.com seemed like a waste of time also since a lot places quote a "teaser rate".

 

[cute fuzzy bunny]

While a lot of scrounging can usually turn up the best rates, they usually have strings attached and are of exceptionally short duration. For the best everyday, no strings attached, no funny business rates my credit unions usually wins out.

Wow, are mortgage rates way up...

Consider a 5/1 or 7/1 fixed/adjustable if you're not fairly sure you're going to stay in the house forever. Most people move in that 5-7 year range, and the fixed/adjustable product can give you a lot of savings. Should it look like you're staying a long time, somewhere in that 5-7 year range you should be able to lock in a reasonable fixed rate refinance.

 

[JPatrick]

Question regarding the online brokers such as ET and others.
I've heard that they will not allow you to dodge an escrow account regardless of the down payment %%. True?
If they do, that's a deal breaker for me.  Escrow accounts suck!

 

[Sundance Kid]

Thanks, for all the Great responses! I would have thanked ya'll sooner but I was looking at Master Blaster's avi. That cracks me up, everytime I see it.

JD

 

[Martha]

Question regarding the online brokers such as ET and others.
I've heard that they will not allow you to dodge an escrow account regardless of the down payment %%. True?
If they do, that's a deal breaker for me. Escrow accounts suck!

Usually there is a loan to value cut off point, ranging from 65% to 80%.

 

[yelnad]

DH works in the industry. It's hit or miss.

Go to your local bank or credit union first - someone that you have an established relationship with. If they can't give you what you want, then go to a bigger broker. For example, until recently my credit union didn't do 30 yr fixed loans, so we had to go to another local bank. Talk to your friends and relatives and ask who they used and if they were happy.

 

[brewer12345]

Question regarding the online brokers such as ET and others.
I've heard that they will not allow you to dodge an escrow account regardless of the down payment %%. True?
If they do, that's a deal breaker for me.  Escrow accounts suck!

E-Trade wouldn't budge on the escrow account, but they sold the loan to Wells Fargo within a couple of months. Wells let me kill the escrow account pretty much immediately.

 

[tryan]

Your two broker strategy sounds interesting. Have you actually done it?

DW and I did the two broker strategy on our second home when the large conservative bank started dragging thier feet (I was leveraged to the hilt) ... and the seller started getting cold feet. The realtor was "in" pretty well with Wally-the-lender so we were forth-coming with our plan. Worked out well, as the realtor played hard ball with the large bank and told them they may loose the loan (if they continue to drag thier feet).

Closed on time at a great rate with the conservative lender. Was out a few hundred bucks to Wally-the-lender.

 

[LOL!]

Question regarding the online brokers such as ET and others.
I've heard that they will not allow you to dodge an escrow account regardless of the down payment %%. True?
If they do, that's a deal breaker for me.  Escrow accounts suck!

We refinanced with e-loan a couple years ago. Superb service ... from phone call to them to final closing just 18 days. They had no problem with not escrowing, but since non-escrowed loans have a slightly higher default rate, you pay a slightly higher rate.

We compared e-loan to a mortgage broker that we had used twice before. She would not budge on her costs, so we saved a couple thousand dollars by going with e-loan.

If you go with a broker, I would just make sure they have personally been in the business more than 2 years. It seems that you just have to be breathing to work as a mgt broker and need no other skills.

 

[Sundance Kid]

What is a "Non-Escrowed Loan?" You mean, with no money down?

Thanks in advance.

JD

 

[REWahoo]

What is a "Non-Escrowed Loan?" You mean, with no money down?

It's where you pay your own property taxes and insurance rather than the mortgage company making the annual payments for you. The lump sum "cushion"you initially put into the escrow account (usually 25% of the annual tax and insurance bill) plus the monthly amount you pay the mortgage company to fund the account is basically no-interest loan to the mortgage company.

 

[Craig]

Suggest you check out www.bankrate.com as well.

We've had luck with Quicken Loans.

Definitely go shopping for your own money ... it is a separate part of the transaction. You're looking for a good source from which to rent the money for the transaction. Really has little to do with buying the house (same is true with cars, by the way).

Consider Quicken's 30-year, fixed rate, interest-only loan. In our case, the rate was same as a fully amortizing loan, and you have the flexibility to pay interest only for 10 years, and then it flips to fully amortizing for the next 20. If you have the discipline to amortize as you can (we're amortizing over 6 years), then this is the best of all worlds. If you need more cash, you just pull back to interest only when you need to. Neat deal.

Join a credit union or two while you're thinking of it. I've never done a real estate loan through one, but their auto loans are usually rock bottom.

Good luck.