Shopping around for mortgage rate

Shah, unfortunately, when it comes down to locking in the rate, a little bit of luck comes in play. You should shop for rates and narrow down the lenders you want to go with after comparing rates. Always compare same day rates. We're in an environment where you really shouldn't find one lender with significantly better rates. You also want to know what to expect by going through a specific lender. Remember, this is a 30-90 day relationship where you'll be in communication with the bank quite often. See what kind of service you're getting pre-application. Is the lender answering all your questions? Will you be handed off to a loan processor after the loan officer takes the application and never hear from the loan officer again? Rates are important since that determines how much your mortgage payment will be but don't forgot the service and process. Sometimes .125% isn't worth the stress of working with a lender that doesn't respond or meet expectations. Just my thoughts. Sunny.hong@bankofamerica.com

going through the process now. I was able to lock rate within 4 days of application with TD. However, had many questions on the documents they provided including an inflated number for Title ( which is set by NYS law) and could not get anyone to answer my questions so I withdrew my application within a time period that ensured only credit report charges ( about $10). When you speak to the larger banks through on-line or cold phone interviews, they tell you stuff that is not accurate. I ended up going with my banker although rate is not lock per Shah accurate description, and I assume that if no deal between Rep/ Dem by the weekend, rates will go up so might withdraw my application again...Yes luck and personal knowledge of the broker/banker is a must. The quality of an "associate" in the mortgage industry comes across as high school drop out...

Ahah: The quality and responsiveness of the mortgage broker or banker is key. I am in complete agreement with Sunny Hong's assessment that "...sometimes .125% isn't worth the stress of working with a lender that doesn't respond or meet expectations..." In my case, my mrtgage broker has done an excellent job thus far from day one (we're in the third stage you identified) and we're locked in as of last Friday at a rate that I am pretty sure I'll never see again in my lifetime.

Hi, not to hijack, but I had a related question regarding mortgage rates. If i lock into a rate of 4.XX% for 60 days and after the 60 days my rate lock expires, what exactly happens? My mortgage broker said they charged a hefty fee for each day after the 60th day that I havent closed(which, if there's a few weeks delay, can cost a couple G's). Can i avoid that and just lock into whatever rate is present after the 60th day? I don't predict rates to fluctuate that much between now and then. thanks

realtime: I think you'll see the quality of the loan officer improve. I'd say half the loan officers in the mortgage industry are now gone from just a couple of years ago. We had way too many people in this industry just trying to make a quick buck. Getting a mortgage hasnt just become more diffciult for buyers. It's gotten difficult for originators as well. So you will continually see the "high school drop out" quality loan officers being slowly weeded out.

Buyerbeware: that depends on the lender. In most cases, you can't just let it expire and take the present rate. You will either have to pay extension fees or the lender may be able to extend for free if there is improved pricing from the day you locked in.
sunny.hong@bankofamerica.com

We had the exact same experience with TD Bank. They had a good rate, but then were completely unresponsive and didn't even have an obvious phone number we could call to discuss the loan with (the number they give you is to an unrelated department that deals with unsecured consumer loans). That became a problem when they sent us an enormous list of materials they wanted, much of which was very hard to figure out.

They also had this extremely unfriendly 50bp fee if the loan didn't close within 60 days, for any reason (which for a conforming-limit loan would have been $3,648 -- kind of a lot). This is not an industry-standard fee; this is something they do on their own initiative.

So we had the exact same result -- we identified them as time wasters and a risk to the deal, pulled the application within the 7-day window and locked the same rate with a mortgage broker.

What TD Bank *is* useful for is as a Web-visible reference rate that you can use to bludgeon other lenders. Tell them "TD Bank is offering this rate - if you can match it then the business is yours." You don't have to tell them that TD Bank is not really usable as a lender or that they have this absurd fee. This is what we did and other lenders are very willing to play the price-matching game.

I used Michael Vogt at Wells Fargo (https://www.wfhm.com/loans/michael-vogt/index.page) for my recent mortgage. I had been in contact with him every so often for several years. I finally made an offer on an apartment on a Friday night and sent him an email on Saturday. I got an initial response on Saturday afternoon. Throughout the next 6 weeks or so he was very responsive - he usually responded to my emails in less than an hour. The loan processor was also very responsive - often responding to emails in a matter of minutes. It was a Fannie Mae loan so Fannie Mae had a few requirements that were kind of a pain but Mike worked with me on those. I think if you are getting a conforming mortgage, most lenders will have about the same rate. I would not have wanted to go through the process with somebody who was not responsive.

I'm not sure about other banks, but I know you can always find WF current rates at https://www.wellsfargo.com/mortgage/rates/

My collection is that there was no application fee and I didn't have to pay any points on the mortgage. After my loan was approved, I had to prepay fees of 0.50% of the loan balance. I could walk away at any time prior to closing and get the entire amount back, less the appraisal fee (I think it was about $700). Once the loan was approved I was able to get a 60 day interest lock for no charge. If rates went down before I closed I had the ability to lower my rate. I think there may have been a fee to reduce the rate but rates never went down after I locked and before closing so it didn't matter for me.

In October 2010 I went into contract and closed in December for a coop on the UWS. David Axelrod at BoA was great - really responsive and made the closing happen when I needed it (before my rate expired though I could have paid to extend it).

schwab bank... best mortgage experience of my life

downtown, mortgage brokers are affiliated with the wholesale division of Wells Fargo, and wholesale rates are never made public. Wells Fargo is now one of the few banks that work with mortgage brokers and they are the best.

That said if one is getting a loan, locking the rate in immediately may not be the way to go. A good mortgage broker knows the lending environment and knows if events in the financial markets will precipitate a rise or fall in rates which by the way are tied to ten year treasuries.

What if you lock the rate in and rates go down further. Do you plan on starting all over and go to another bank. Doesn't make sense.

The best strategy is to have a mortgage broker who is diligent and gives you personalized service along with a great rate.

Ellen Silverman
E.S. Funding Co.
www.esfunding.instantlender.com

If a mortgage broker has a crystal ball so shiny that s/he can predict with absolute certainty the future of the 10 year Treasury, then why on Earth is that person dealing with lousy residential mortgages instead of running PIMCO?

Besides, the weather in Newport Beach beats NYC any day.

The weather in Newport Beach may beat NYC any day, but Broadway is here and nowheres else.

It's not a question of having a crystal ball, it's a question of knowing the financial environment. People buy stocks and the successful ones know the financial environment. The trend is your frined, ever hear of that.

And mortgage brokers don't only deal with "lousy residential mortgages". Maybe that's all loan originatiors who work for the big banks do. For us mortgage brokers,besides residential loans, there's commerical mortgages, underlying co-op mortgages, FHA mortgages etc. 2% commission on a $3million dollar loan; do the math.

Instead of busting out cliches, why don't you impress us all with your knowledge of the financial environment and tell us what the 10Y will yield this Friday and next Friday? Then we can check back and see if you're really earning that 2% or just along for the ride. Deal?