which lender is the best to choose? The one with the lowest fees?

Question

One guy is like 1200 off but seems to have the better rate? Sounds like he's hding something. At the end of the month I have to pay the freight(mortgage). The guy with the lesser of fees has a good point, His fees are way less and he said that with the exta money the other is charging I can even BUY points and Hes still at a better rate.

Answer 1

Do you know what you are shopping for? Are you comparing apples and apples or oranges and apples and can't come to a conclussion as to which is the best loan.

The only real way you can compare a loan is if they have the same terms, amortized the same,with the same loan amout.

Now once that has been accomplished you can take and compare the APR as to which is the best of that particular loan.

Example: one loan is for $140,000 the interest rate is 5.875 the term is 30/30. Those are all constants. Now what are the fees and points these are not constant.

If one is chargiing for a processing fee $500.00 and an admin fee of $250. as well as 1.5 points but the other is not charging an fees your APR will reflect that.

Now which is the better loan?

It is not proper to compare an adjustable rate loan with a 40 year loan due in 30 years. Or a loan you buy down with a loan that is a 5/1 Arm.

Stop running around you can do this for weeks upon weeks.

You have to know what you are qualified to purchase even if you have bad or good credit.

So the first thing you should do is contact a mortgage broker so you can complete a loan application, after which he will run your credit report.

This credit report will give him your credit score. Get a cup of coffee or your favorite beverage when filling out the loan application this is not a 15 minute chore.

Your credit score will tell him what loan programs you are qualified for as well as the interest rate you can expect. This credit score will tell if you are able to get a 100% loan and if not how much cash you have to bring to the table as your down payment.

There are lots of documents and information the mortgage broker will need. I will give you a few to get you started.

#1 Six months of all bank statements you use currently, as well as any statements from your 401k at your place of employment

#2 One months of pay stubs from all that are going on the mortgage.

#3 Two years of federal income taxes and W-2s

After discussing the best loan program for you and agreeing on the program you want, the mortgage broker will issue you a pre-approval letter.

You can discuss any loan scenario you would like to discuss. Adjustable, buy downs, fixed rate, the number of years, closing cost.

Start comparing apples with apples and oranges with oranges.

Now once this has been established you should connect up with a real estate agent to find you a home. Upon finding a home you like the real estate agent will then prepare a sales contract for you and the seller to sign.

The mortgage broker will order an appraisal of the house to prove the value.

Once all the documents necessary has been collected the mortgage broker will order loan docs for the program that you agreed to earlier. Again don't plan on spending a lunch hour there to sign loan docs this is a process so be prepared to be there for awhile.

Don't sign the loan docs if anything change from what the mortgage broker explained to you. Call and get an explanation.

I hope this has been of some use to you, good luck.

"FIGHT ON"

Answer 2

Before addressing the comparison of lenders, it's important to consider the type of loan in which you are enrolling.

30 year/fixed rate: If you have chosen this loan vehicle, don't pay points. Use the $1,200 you would consider for buying points to make a lump sum contribution to the principle loan amount. Your $1,200 will have a greater positive impact over time. While shopping for the best loan of this type, simply shop for lowest "origination fee", "administrative fee", "processing fee" and the lowest rate. Low fees, Low rate, end of story.

ARM (Adjustable Rate Mortgage): This is a "temporary loan" and typically has a shelf life of about 5 years, on average. So if you're being solicited with an ARM loan, remember that you will basically be forced to refinance in 5 years (or whatever the the term of the ARM) and face closing costs all over again. Be sure to weigh the state of appreciation of housing in your market before entering an ARM these days. This can compensate for the closing costs you may face each time you refinance. This is also an effective loan product for people that will not be in the same house for a long period of time. For effective ways to manage an ARM loan, see my article at http://EzineArticles.com/?expert=J.C._Spearry

Which lender is best to choose? The one that demonstrates the highest level of expertise by offering a loan program that complements your long-term financial goals, offers you the lowest rate and doesn't charge "points" as his origination fee (should be no more than a $995 flat fee).

Good Luck! I'm most effective in Ohio and Florida. I hope this has provided you with some tasty food for thought.

Answer 3

When choosing a Lender, make sure you compare "apples to apples".

Compare APR to APR, where it includes the interest rate and all their fees rolled into one number. By law, all Lenders must provide you with their APR. Also, make sure you compare like loan products: 30-year fixed to 30-year fixed, etc.

Good luck!

PS: You cannot go wrong with Countrywide Home Loans (not knowing where in the world you are).

Answer 4

Just check to see that you don't get stuck with a prepayment penalty as you will not be able to refinance again.

Answer 5

It sounds like you need to shop around some more.
Try bankrate.com