question for the banker/mortgage peep here

[soulman]

Looking at securing financing for a new home I am getting. I am currently being "courted" by a number of lenders but they all seem to be offering the same thing. my question:
They say shop around for a lender but if they all offer the same interest rate what incentives should make one better than the others? The only difference I have noticed is one company is offering to pay the title fees. Also should I deal directly with a bankversus a mortgage broker?

[DJ Teji]

Looking at securing financing for a new home I am getting. I am currently being "courted" by a number of lenders but they all seem to be offering the same thing. my question:
They say shop around for a lender but if they all offer the same interest rate what incentives should make one better than the others? The only difference I have noticed is one company is offering to pay the title fees. Also should I deal directly with a bankversus a mortgage broker?

I would try too get a tracker mortgage if they have them in the US, I have a TRACKER mortgage that tracks the UK Bank Of England Base Rate, the base rate here is 0.5 and my mortgage is one that tracks at 0.25% above base rate so I pay only 0.75% on my mortgage, I have the facility to over pay which I'm doing as it knocks of the capital without any penalties. You should look at one where there are no penalties if you over pay or any charges if you want to switch to another lender, incase you see a better deal in the near future. I would not go for a fixed rate personaly as they work out more expensive in the long run.

I'm no banker but have had experience with mortgages with my own properties.

Take your timme and remember the banks are not your friend so do your homework properly, which it looks like you are doing. This will be a millstone around your neck for the next 20-30 years so take your time.

All The Best

Teji

[DeesKo]

Looking at securing financing for a new home I am getting. I am currently being "courted" by a number of lenders but they all seem to be offering the same thing. my question:
They say shop around for a lender but if they all offer the same interest rate what incentives should make one better than the others? The only difference I have noticed is one company is offering to pay the title fees. Also should I deal directly with a bankversus a mortgage broker?

The interest rate may be the same, but what you want to do is make sure you are comparing apples to apples and then compare costs.

Sometimes you'll get a Good Faith Estimate that pads origination fees etc but leaves out your escrow or your VA funding fee (in the case of a VA loan) etc, so the overall cost LOOKS lower on the GFE but when you get to the closing table it's really more expensive.

Or they may offer to pay the title fees and then charge you twice as much for courier fees.

Look at each Good Faith Estimate and make sure they are all charging you for the same things... escrow estimates, county recording fees, etc. All of the stuff that is going to be the same no matter who you go through for the loan. Weed out the ones that leave some of this out because they're being disingenous, then move on to comparing the terms of the actual loans.

1. Interest rate is only one part of the loan. If you're talking strictly about costs of the loan (meaning all of the terms are the same) you want to look at interest rate, origination fees, funding fees, processing fees, courier fees etc.

2. Look at the APR for each loan, not the "interest rate" the APR is supposed to act as a single point of reference for how much the loan is going to cost you over the life of the loan so it is supposed to roll in your points, origination fees etc and express it as a percentage rate.

3. A broker is a middle man between a lender & you. They charge a fee for this service. This can either cost you thousands more than necessary (if the broker provides you the same loan terms as going directly to the bank) or it can save you thousands (if the broker is able to shop your loan and get you an interest rate that is low enough that it offsets the origination fees he's going to charge you.

ie.

a bank offers a loan with an interest rate of 4.5% & $10000 in total cost of loan origination

a broker offers a loan with an interest rate of 4.0% & 12000 in total cost of loan origination

The .5% lower interest rate is going to save you FARRRR more than the extra $2k in closing costs up front so in that instance a broker isn't a bad move

a bank offers a loan with an interest rate of 4.5% & $10000 total cost of loan origination

a broker offers a loan with an interest rate of 4.5% & $14000 total cost of loan origination

The broker is offering you the same loan as the bank, but charging you an extra $4k to do it. This is a waste of $4k.

It's always dicey talking about loans because that's someone's life, the biggest investment they're going to make and you don't want to misguide them, but you don't want to NOT help either. Do some searching online and really get yourself well-versed in all of the fees associated with going to closing on a house.

There are many that are non-negotiable and aren't going to change, no matter who you use. There are many others that are negotiable and most certainly will change depending on who you go with.

The only way to really feel comfortable with your loan is to really, really understand the Good Faith Estimate, it's strengths & weaknesses (like the fact that it's not legally required to be 100% accurate) and to really understand all of the various fees that go into the purchase.

Good luck!!!!

[liL Ray]

a bank offers a loan with an interest rate of 4.5% & $10000 in total cost of loan origination

a broker offers a loan with an interest rate of 4.0% & 12000 in total cost of loan origination

The .5% lower interest rate is going to save you FARRRR more than the extra $2k in closing costs up front so in that instance a broker isn't a bad move

a bank offers a loan with an interest rate of 4.5% & $10000 total cost of loan origination

a broker offers a loan with an interest rate of 4.5% & $14000 total cost of loan origination

this...

[soulman]

The interest rate may be the same, but what you want to do is make sure you are comparing apples to apples and then compare costs.

Sometimes you'll get a Good Faith Estimate that pads origination fees etc but leaves out your escrow or your VA funding fee (in the case of a VA loan) etc, so the overall cost LOOKS lower on the GFE but when you get to the closing table it's really more expensive.

Or they may offer to pay the title fees and then charge you twice as much for courier fees.

Look at each Good Faith Estimate and make sure they are all charging you for the same things... escrow estimates, county recording fees, etc. All of the stuff that is going to be the same no matter who you go through for the loan. Weed out the ones that leave some of this out because they're being disingenous, then move on to comparing the terms of the actual loans.

1. Interest rate is only one part of the loan. If you're talking strictly about costs of the loan (meaning all of the terms are the same) you want to look at interest rate, origination fees, funding fees, processing fees, courier fees etc.

2. Look at the APR for each loan, not the "interest rate" the APR is supposed to act as a single point of reference for how much the loan is going to cost you over the life of the loan so it is supposed to roll in your points, origination fees etc and express it as a percentage rate.

3. A broker is a middle man between a lender & you. They charge a fee for this service. This can either cost you thousands more than necessary (if the broker provides you the same loan terms as going directly to the bank) or it can save you thousands (if the broker is able to shop your loan and get you an interest rate that is low enough that it offsets the origination fees he's going to charge you.

ie.

a bank offers a loan with an interest rate of 4.5% & $10000 in total cost of loan origination

a broker offers a loan with an interest rate of 4.0% & 12000 in total cost of loan origination

The .5% lower interest rate is going to save you FARRRR more than the extra $2k in closing costs up front so in that instance a broker isn't a bad move

a bank offers a loan with an interest rate of 4.5% & $10000 total cost of loan origination

a broker offers a loan with an interest rate of 4.5% & $14000 total cost of loan origination

The broker is offering you the same loan as the bank, but charging you an extra $4k to do it. This is a waste of $4k.

It's always dicey talking about loans because that's someone's life, the biggest investment they're going to make and you don't want to misguide them, but you don't want to NOT help either. Do some searching online and really get yourself well-versed in all of the fees associated with going to closing on a house.

There are many that are non-negotiable and aren't going to change, no matter who you use. There are many others that are negotiable and most certainly will change depending on who you go with.

The only way to really feel comfortable with your loan is to really, really understand the Good Faith Estimate, it's strengths & weaknesses (like the fact that it's not legally required to be 100% accurate) and to really understand all of the various fees that go into the purchase.

Good luck!!!!

Thanks for this!!! It is pretty valuable info. Sounds like the best thing to look for is the origination fee. Th broker explained it to me that the origination fee is to bring the interest rate down to the most current rate i.e the current rate of 4.675 at the moment. I ma getting 2 estimates this morning and I will let you know what the fees are

[liL Ray]

Sounds like the best thing to look for is the origination fee. Th broker explained it to me that the origination fee is to bring the interest rate down to the most current rate i.e the current rate of 4.675 at the moment.

If you read what D wrote and this is what you took away from it, you missed the point.

First off the current rate that is closest to par on a 30yr fix rate as of yesterday is 4.25%. Par rate is the rate where it does not "cost" the borrower to get the rate. "Buying down" the rate is when you start to go below that rate. In other words the LENDER (the actually instituition giving you the loan) will "if you want a lower rate, we can give it to you, but it is going to cost you"....

now the word "cost" is tricky: It can either cost the borrower (you) or the broker getting you the loan (comes out of his commission).

Anything above the Par Rate is what is called a yield spread premium....this is the extra that the LENDER pays to the Brokers for bringing them the business and getting their customer (you) to take a higher rate.

This cost is put on the GFE as ORIGINATION Fee. The broker fee is the upfront, clear as day fee on the GFE, and the YIELD SPREAD PREMIUM (YSP) is the fee that is paid to the broker by the Lender (NOT YOU). Now this is where the difference between a bank and a broker comes into play...if you are a bank, you do not have to show the YSP to the customer on the GFE (Good Faith Estimate).

The problem comes in when the customer feels they should get a loan for free and the person working to get that loan (the mortgage broker, banker, loan officer, etc) should not get paid. Most of these people work for a commission. They also choose this business because it pays very well. If they wanted to work for nothing, they would be selling newspapers. So what Deesko is saying is correct...he is saying it is either pay me now or pay me later. It's either you pay the upfront broker fee and get the rate closest to par, or you pay little or not broker fee and get a higher rate...Either way the broker (even if it is your relative) is NOT going to work for free.

As deesko said, if you have apples vs. apples and one guy is giving you a $400K loan @4.5% and charging you 1% broker fee and the other guy is charging you 2%, you obviously are going to go with the 1% guy, or at least talk with the 2% guy (if you have a better relationship with him) and have him come down to 1% if you are not feeling the other broker.

Another reason you work with a broker vs. a banker (your original question), is that a broker can place his business with many lenders where a banker is just placing the business with his bank. The only pro to this is that in the chance that you get turn down for the loan, a broker can repackage the loan and send it to another Lender for an approval, where a banker is one and out. However, if you are qualified, and the banker is offering you the best deal, and you have a good relationship with the banker (often overlook, but important), then you just go with the banker. However, once you get turn down by that bank, you have no choice but to find a mortgage broker, and make sure you let them know which bank turn you down and why.

Another reason to go with one over the other, comes down to speed of closing and of course honesty. Again, this is tricky and you have to go with your gut. Speed of closing really comes down to knowledge of the business. The business have changed som much since even 2 years ago due to extra regulations, guidelines, and upfront disclosures that must be signed even before you can even think about rates. When I hear folks say "but he say he can close within a week" I tell them "go with him - have a good day" because I know it is bullshit nowadays. Then I call them back in 2 weeks and get the business. Reality is, if your loan officer knows what he or she is doing, you will close within 3-4 weeks, if it is a straight forward deal (no title issue, you are qualified, no appraisal issue like the back wall of the house is missing when the appraiser goes out to inspect, etc).

Honesty is how the loan officer handle the discussion of what I wrote in the 2nd paragraph and how he or she makes you feel about the entire transaction.

So to cap off:

4.375% with a 2% broker fee, you close within 3 weeks.

or

4.625% with a 0% broker fee...you close in 6 weeks, and you hate the fucking loan officer.

Your choice....

Good luck.

[liL Ray]

update:

rates have ticked up since yesterday morning....par is hovering at 4.5 to 4.625% this morning (the rates usually come out at 11am, but I am looking at Wells Fargo rate sheet as I type, and this is the rates they are quoting as of late yesterday). But to soulman who is juststarting the process, you probably won't be locking any rate for at least 2 more weeks, and the rates tick up and down all the time, but not in a drastic manner. Unless you hear that the Fed Fund Rate is being raised, do not comncern yourself too much about rates until you at least have a contract, have an approval, did the appraisal and now have to lock your rate...I have seen the rate go from 4.25% to 4.5% the day before I had to close my customer...then the very next morning ticked back down to 4.25%.

[soulman]

If you read what D wrote and this is what you took away from it, you missed the point.

First off the current rate that is closest to par on a 30yr fix rate as of yesterday is 4.25%. Par rate is the rate where it does not "cost" the borrower to get the rate. "Buying down" the rate is when you start to go below that rate. In other words the LENDER (the actually instituition giving you the loan) will "if you want a lower rate, we can give it to you, but it is going to cost you"....

now the word "cost" is tricky: It can either cost the borrower (you) or the broker getting you the loan (comes out of his commission).

Anything above the Par Rate is what is called a yield spread premium....this is the extra that the LENDER pays to the Brokers for bringing them the business and getting their customer (you) to take a higher rate.

This cost is put on the GFE as ORIGINATION Fee. The broker fee is the upfront, clear as day fee on the GFE, and the YIELD SPREAD PREMIUM (YSP) is the fee that is paid to the broker by the Lender (NOT YOU). Now this is where the difference between a bank and a broker comes into play...if you are a bank, you do not have to show the YSP to the customer on the GFE (Good Faith Estimate).

The problem comes in when the customer feels they should get a loan for free and the person working to get that loan (the mortgage broker, banker, loan officer, etc) should not get paid. Most of these people work for a commission. They also choose this business because it pays very well. If they wanted to work for nothing, they would be selling newspapers. So what Deesko is saying is correct...he is saying it is either pay me now or pay me later. It's either you pay the upfront broker fee and get the rate closest to par, or you pay little or not broker fee and get a higher rate...Either way the broker (even if it is your relative) is NOT going to work for free.

As deesko said, if you have apples vs. apples and one guy is giving you a $400K loan @4.5% and charging you 1% broker fee and the other guy is charging you 2%, you obviously are going to go with the 1% guy, or at least talk with the 2% guy (if you have a better relationship with him) and have him come down to 1% if you are not feeling the other broker.

Another reason you work with a broker vs. a banker (your original question), is that a broker can place his business with many lenders where a banker is just placing the business with his bank. The only pro to this is that in the chance that you get turn down for the loan, a broker can repackage the loan and send it to another Lender for an approval, where a banker is one and out. However, if you are qualified, and the banker is offering you the best deal, and you have a good relationship with the banker (often overlook, but important), then you just go with the banker. However, once you get turn down by that bank, you have no choice but to find a mortgage broker, and make sure you let them know which bank turn you down and why.

Another reason to go with one over the other, comes down to speed of closing and of course honesty. Again, this is tricky and you have to go with your gut. Speed of closing really comes down to knowledge of the business. The business have changed som much since even 2 years ago due to extra regulations, guidelines, and upfront disclosures that must be signed even before you can even think about rates. When I hear folks say "but he say he can close within a week" I tell them "go with him - have a good day" because I know it is bullshit nowadays. Then I call them back in 2 weeks and get the business. Reality is, if your loan officer knows what he or she is doing, you will close within 3-4 weeks, if it is a straight forward deal (no title issue, you are qualified, no appraisal issue like the back wall of the house is missing when the appraiser goes out to inspect, etc).

Honesty is how the loan officer handle the discussion of what I wrote in the 2nd paragraph and how he or she makes you feel about the entire transaction.

So to cap off:

4.375% with a 2% broker fee, you close within 3 weeks.

or

4.625% with a 0% broker fee...you close in 6 weeks, and you hate the fucking loan officer.

Your choice....

Good luck.

thanks lil ray. that is not all that I took but it made it more clear the second time I read through the post. thanks again and any more feedback would be most apprciated

[DeesKo]

Thanks for this!!! It is pretty valuable info. Sounds like the best thing to look for is the origination fee. Th broker explained it to me that the origination fee is to bring the interest rate down to the most current rate i.e the current rate of 4.675 at the moment. I ma getting 2 estimates this morning and I will let you know what the fees are

I can not stress this enough...

A mortgage deal is a very fine balance of about 25 different fees & credits.

Most of them are pegged as a percentage of the loan amount ( 2% of the loan amount, 1% of the loan amount etc) which means even a small change can equal thousands of dollars in either direction.

As such, do not.... DO NOT evaluate a mortgage based on any 1, 2, or 3 things.

You have to take the time to look at every single one of the fees and/or credits and evaluate them. If you do not, you will get fleeced, and fleeced for thousands, or at least you'll feel like you did for the next 10 years.

Peace

[soulman]

update:

rates have ticked up since yesterday morning....par is hovering at 4.5 to 4.625% this morning (the rates usually come out at 11am, but I am looking at Wells Fargo rate sheet as I type, and this is the rates they are quoting as of late yesterday). But to soulman who is juststarting the process, you probably won't be locking any rate for at least 2 more weeks, and the rates tick up and down all the time, but not in a drastic manner. Unless you hear that the Fed Fund Rate is being raised, do not comncern yourself too much about rates until you at least have a contract, have an approval, did the appraisal and now have to lock your rate...I have seen the rate go from 4.25% to 4.5% the day before I had to close my customer...then the very next morning ticked back down to 4.25%.

Actually I vae a contract on the house and I am trying to close by the end of the year. the house is ready(had it built) and the final walkthrough is planned for within the next 2 weeks. I was going to trey to lock the rate today as I have been soliciting quotes for the last 2 weeks. talked with wells fargo, bank of america, and 2 brokers. so far the broker that I am dealing with is offering the best deal with the company covering the title fees (about 1800). He did infolrm me that he would send me the most updated rates when they come out this morning. would you like to see the quote sheets?

[soulman]

I can not stress this enough...

A mortgage deal is a very fine balance of about 25 different fees & credits.

Most of them are pegged as a percentage of the loan amount ( 2% of the loan amount, 1% of the loan amount etc) which means even a small change can equal thousands of dollars in either direction.

As such, do not.... DO NOT evaluate a mortgage based on any 1, 2, or 3 things.

You have to take the time to look at every single one of the fees and/or credits and evaluate them. If you do not, you will get fleeced, and fleeced for thousands, or at least you'll feel like you did for the next 10 years.

Peace

the bank quotes have them defined differently than the broker quote but I am comparing them side by side to see whats best. trust me I am taking all this in and trying to evaluate it. I hear ya talking

[liL Ray]

Actually I vae a contract on the house and I am trying to close by the end of the year. the house is ready(had it built) and the final walkthrough is planned for within the next 2 weeks. I was going to trey to lock the rate today as I have been soliciting quotes for the last 2 weeks. talked with wells fargo, bank of america, and 2 brokers. so far the broker that I am dealing with is offering the best deal with the company covering the title fees (about 1800). He did infolrm me that he would send me the most updated rates when they come out this morning. would you like to see the quote sheets?

I would not lock the rate today....the rates deteriorated late yesterday...you are talking yesterday morning par was 4.25 and this morning it will probably be at 4.5 or 4.625%...wait...he will probably tell you the same thing also.

As far as the total fees (broker fee, processing, title, government, etc) expect to pay between 4-6% of what your loan amount is...under 4%, great deal, if they are not telling you what you want to hear and can pull it off.

Just remember, everybody got to eat.

[liL Ray]

Actually I vae a contract on the house and I am trying to close by the end of the year.

If this is the case, if you have not done so yet, you should be scheduling the appraisal to be done by the weekend and you should have your approval/loan comitment from the bank by next friday the latest. This is a short month and you should target Dec 22nd to have all outstanding conditions in to have a chance to close for the month of December.

[soulman]

I would not lock the rate today....the rates deteriorated late yesterday...you are talking yesterday morning par was 4.25 and this morning it will probably be at 4.5 or 4.625%...wait...he will probably tell you the same thing also.

As far as the total fees (broker fee, processing, title, government, etc) expect to pay between 4-6% of what you loan amount is...under 4%, great deal, if they are not telling you what you want to hear and can pull it off.

Just remember, everybody got to eat.

yeah I dont mind paying for a service...just want to get the note where I want it. I assumed that since its the end of the year everybody was trying to close and the interest rate could only go up. but perhaps I will wait until tomorrow. thanks again for the advice. in reviewing the docs from both the bank and the broker the broker is cheaper on everything, appraisal fee, credit report fee, recording fee, and they are paying the title insurance

[liL Ray]

they are paying the title insurance

this is not believable...

also, if you are still "reviewing docs", this means your file/application have not yet been submitted anywhere, so I doubt you will be closing the end of the year. You need to make a decision, sign your docs, and have your paperwork submitted at least by tomorrow, maybe by monday the latest, to have a chance to close at the end of the month.

Many of these banks are on 5-8 business days for conditional approval turn times. Then, when you do get all your conditions in, it can be as 2 - 3 days before you can schedule closing.

Realistically expect to close Jan 11th....anything before that time is gravy.

[DeesKo]

this is not believable...

also, if you are still "reviewing docs", this means your file/application have not yet been submitted anywhere, so I doubt you will be closing the end of the year. You need to make a decision, sign your docs, and have your paperwork submitted at least by tomorrow, maybe by monday the latest, to have a chance to close at the end of the month.

Many of these banks are on 5-8 business days for conditional approval turn times. Then, when you do get all your conditions in, it can be as 2 - 3 days before you can schedule closing.

Realistically expect to close Jan 11th....anything before that time is gravy.

Unfortunately, I would agree with this when you consider the holidays pending etc.

Granted, we had a very difficult, messy loan but it took us almost 2 months to close because lenders are being SUPER tedious with their paperwork and sometimes on weird stuff too.

[liL Ray]

lenders are being SUPER tedious with their paperwork and sometimes on weird stuff too.

tedious is putting it kindly....After the appraisal came in, I had one lender tell me that the home needed a "coat of paint" on the outside wall of the garage because it was peeling. Nothing wrong with the structure itself, just the 2 x 1 foot section (if that big) where the paint was stripping. The fíng garage wasn't even connected to the home.

Had another underwriter tell another loan officer I work with that the Homeowner's Insurance policy need to have a clause that read if the tenants don't pay rent, the policy would pay the rent....Obviously there is no such clause or else we would all be in "making fictious claims to the insurance company" business.

They do get "tedious" with the underwriting nowadays...

[liL Ray]

ok, on a FHA 30 yr fix, 4.25% is still par.

On a Conforming 30 yr fix it is 4.49.

That's if you lock today...and keep in mind, you cannot lock anything unless your loan (signed docs and contract) has been submitted and you have a conditional approval from the Lender.

[DeesKo]

tedious is putting it kindly....After the appraisal came in, I had one lender tell me that the home needed a "coat of paint" on the outside wall of the garage because it was peeling. Nothing wrong with the structure itself, just the 2 x 1 foot section (if that big) where the paint was stripping. The fíng garage wasn't even connected to the home.

Had another underwriter tell another loan officer I work with that the Homeowner's Insurance policy need to have a clause that read if the tenants don't pay rent, the policy would pay the rent....Obviously there is no such clause or else we would all be in "making fictious claims to the insurance company" business.

They do get "tedious" with the underwriting nowadays...

My loan started with Wells, then moved to a local broker because Well's couldn't get around our business.

They wouldn't even try.

They literally were like...

"ohhh mmmm... you own a business... yeah, see.. what had happened was.... you should look for another lender, mmmkay? Thanks"

The original request for the VA appraisal went in via Wells.

The loan moved to the broker, the VA appraisal came back fine & was delivered by the VA directly to the broker. We went to underwriting and the underwriter held the loan up for a WEEK because they wanted a copy of the request for the appraisal.

Not the actual appraisal. They had that.

They wanted the original request.

Wells couldn't produce it because the loan had been moved to the broker and they didn't have access to the loan anymore. The broker claimed they couldn't produce it because they weren't the ones who created the request and therefore, they didn't have access to the request.

It was like the request was caught in some weird limbo and the underwriter was literally ready to close down the whole loan because they didn't have a paper copy of a letter saying "can you give me an appraisal on this property, please?".

We ended up finding a way around it eventually, but it was very stressing.

That was only one of multiple things we dealt with. We were satisfying conditions for a month and every time we would think we had all of them covered, they would come up with more.

One time, I was in off-site training for 4 days in Maryland & had to borrow an instructor's computer so that I could log in and get my most recent paystub for the underwriter because the 3 months worth I'd already sent 2 weeks ago weren't good enough.

It was insane.

Even now, we've been closed 45 days, they're STILL contacting me asking for follow up paperwork/copies of documents related to my tax returns etc.

They popped up on the Tuesday before Thanksgiving and said "we need another copy of your 2009 personal & business tax returns. If you do not provide them by Wednesday COB your loan will be rescinded".

I went ballistic and demanded to know what their reasoning was for threatening me like that, and what legal grounds they thought they would have for rescinding a closed loan 45-50 days after closing because I couldn't produce a document THEY ALREADY HAD in 24 hours or less during a holiday week and they backed off and got a lot nicer but it's been a nightmare.


This is not intended to scare you off soulman.... just saying, it's not as easy as it used too be.

[liL Ray]

My loan started with Wells, then moved to a local broker because Well's couldn't get around our business.

They wouldn't even try.

They literally were like...

"ohhh mmmm... you own a business... yeah, see.. what had happened was.... you should look for another lender, mmmkay? Thanks"

The original request for the VA appraisal went in via Wells.

The loan moved to the broker, the VA appraisal came back fine & was delivered by the VA directly to the broker. We went to underwriting and the underwriter held the loan up for a WEEK because they wanted a copy of the request for the appraisal.

Not the actual appraisal. They had that.

They wanted the original request.

Wells couldn't produce it because the loan had been moved to the broker and they didn't have access to the loan anymore. The broker claimed they couldn't produce it because they weren't the ones who created the request and therefore, they didn't have access to the request.

It was like the request was caught in some weird limbo and the underwriter was literally ready to close down the whole loan because they didn't have a paper copy of a letter saying "can you give me an appraisal on this property, please?".

We ended up finding a way around it eventually, but it was very stressing.

That was only one of multiple things we dealt with. We were satisfying conditions for a month and every time we would think we had all of them covered, they would come up with more.

One time, I was in off-site training for 4 days in Maryland & had to borrow an instructor's computer so that I could log in and get my most recent paystub for the underwriter because the 3 months worth I'd already sent 2 weeks ago weren't good enough.

It was insane.

Even now, we've been closed 45 days, they're STILL contacting me asking for follow up paperwork/copies of documents related to my tax returns etc.

They popped up on the Tuesday before Thanksgiving and said "we need another copy of your 2009 personal & business tax returns. If you do not provide them by Wednesday COB your loan will be rescinded".

I went ballistic and demanded to know what their reasoning was for threatening me like that, and what legal grounds they thought they would have for rescinding a closed loan 45-50 days after closing because I couldn't produce a document THEY ALREADY HAD in 24 hours or less during a holiday week and they backed off and got a lot nicer but it's been a nightmare.


This is not intended to scare you off soulman.... just saying, it's not as easy as it used too be.

welcome to my world...this is why when folks come to me and "jew me down" on my fees (sorry, but it is an accepted NY terminology), I just tell them go someplace else.

These banks and their underwriters are using us as show dogs and having us jump through hoops for their entertainment.

Deesko, the paystub thing they ask for because your loan went over 30days and the last paystub you gave them expire 30 days.

As far as the bank coming back to you for paperwork after you close, that should never happen and is the fault of the broker you use....they should be contacting the broker for additional paperwork and, if need be, he should be contacting you with a friendly phone call.. As long as you are close, and you are up to date on your mortgage, you should be able to tell them...



Since they have moved to doing appraisal through these appraisal management companies (which I understand, but do not like, and contrary to what they sell to public, is not good for the public), that appraisal process can be a nightmare, especially when you have to move the deal from one bank to the next. This is why I do not have my clients order any appraisal until I get the conditional appraoval and "see" that we can close the loan...then and olny then I will instruct the client to order the appraisal. Also, because these appraisers are barely making anything on these appraisals anymore (they have to split the fee with these management companies - actually, you pay the management company and then they pay the appraiser), they find any reason to fuck up your appraisal report so they have to go back out...they get a "return trip" fee for this bullshit.

I had one appraiser take a picture of the missing cover off the fuce box (yes, the little metal cover that cost maybe $20, and the underwriter hold up the deal because the needed that fix, and for the appraiser to go back out and take a picture of it and comment that "the cover is now replaced". Of course, for a charge of $125 return fee to the customer. Let's just say me and that banks regional manager are on first name basis now.

[Mr.I]

When I bought my house earlier this year my "adjusted origination charges" ended up being a negative amount, they gave me a big credit for the interest rate chosen. I don't understand why they did that?

[liL Ray]

When I bought my house earlier this year my "adjusted origination charges" ended up being a negative amount, they gave me a big credit for the interest rate chosen. I don't understand why they did that?

If I am understanding you correct, you mean your closing cost was lower? (is that what you are saying??)

If so it's because the Lender did that because your loan officer (you used a mortgage broker, I believe) messed up on the new GFE and had to hand over his yield spread premium that he was getting from the bank. Believe it or not, when he sent in the disclosure paperwork at the start of the loan, he checked the wrong box (yes, checked - on the GFE there is a box that says credit and one that says discount and to get the YSP, the broker is to check the discount...if he does it the other way, it can be the difference of gifts for Christmas or Bah humbug for all) and had to turn over his yield spread toward your closing cost. It probably reduce your closing cost by a few thousand $$s. If it had turned out that that amount would have resulted in you getting an excess, then they would have reduced the loan amount, had to redisclosed and reschedule the closing. Unless this was discussed with you beforehand, then the broker was not happy...(s)he probably spin it in the "see how much I saved you?" line.

You should give them a referal for that.

[Mr.I]

If I am understanding you correct, you mean your closing cost was lower? (is that what you are saying??)

If so it's because the Lender did that because your loan officer (you used a mortgage broker, I believe) messed up on the new GFE and had to hand over his yield spread premium that he was getting from the bank. Believe it or not, when he sent in the disclosure paperwork at the start of the loan, he checked the wrong box (yes, checked - on the GFE there is a box that says credit and one that says discount and to get the YSP, the broker is to check the discount...if he does it the other way, it can be the difference of gifts for Christmas or Bah humbug for all) and had to turn over his yield spread toward your closing cost. It probably reduce your closing cost by a few thousand $$s. If it had turned out that that amount would have resulted in you getting an excess, then they would have reduced the loan amount, had to redisclosed and reschedule the closing. Unless this was discussed with you beforehand, then the broker was not happy...(s)he probably spin it in the "see how much I saved you?" line.

You should give them a referal for that.

Wow, so that's what happend! Yes my closing costs were lower by a few grand. For some reason I thought he was gaming the system and putting $$ in his pocket but now I see it was the opposite. Thanks

[Steven Stewart]

I think Soulman owes liL Ray 1%.....

[liL Ray]

I think Soulman owes liL Ray 1%.....

hahahahaha....