Do I have to keep my mortgage broker?

You want a 30 year fixed. He's offering 3 year ARM. Move on already and shop around.

Yes, you can change Mortgage provider even after signing the contract, but be careful:

When comparing mortgage providers make sure you are comparing apples to apples:
1. Are you comparing rates on a same day? (because unless you locked it - they can change daily)
2. How many points are you paying? (1 point = 1% of a loan amount, and translates into 1/4% of a interest reduction.
3. How many days is you rate locks for with this lender? (you will have to pay in order to extend after your rate expiration day.)
4. Is there any pre-payment penalties?
5. Total cost of the loan ( that means that you have to look at Good Face Estimate and take off all the gov/state taxes - that are standard, but look at the total bank fees. You may not have points, but have commitment fee, ets...)

Remember that mortgage broker has access to many lenders, when bank has access to its products only.
Also pay attention to commitment expiration - which translates into bank wanting to check all your financial situation all over again (FICO, STI ratio, if you still employed, ets..)

Another thing, while exploring your options, understand that many mortgage inquiries on your CREDIT REPORT considered as one only if done within 30 days. After that it lowers your FICO score couple of points (it restores in several months, but they can make the difference bwn. your interest rate or product that you can qualify for). Get your FICO score from all three bureaus yourself and give copy to whomever you planning to ask for mortgage.

Good luck
elena
(broker)

I had the same questions recently.... I was warned about submitting an application to a bank where my application had already been submitted by the broker... something bad would ensue... you have to find out exactly where the broker shopped you around before you go on your own. My lawyer at the time gave me the heads up...maybe ask yours.

Hi Junniper89,

I would be more than happy to price out a few scenarios for you. Our 30 year fixed product is pricing competitively in the market and we would not have to charge you any points unless you wanted to buy down the rate.

Shaun_Mirza@Countrywide.com

where's sunny hong?

Hello Juniper89, you do not have to keep you mortgage broker. I work for the largest broker in New York City and we have 30 Fixed Jumbo and Conforming loans at very competitive rates as well as 3, 5, 7 and 10 Year ARMs. If you are using someone from our office I can assure we have every product that is possibly available. Every loan scenario depends not only on the borrower but also the condo. If you are not using someone from Manhattan Mortgage please feel free to contact me with any questions at jsemon@manhattanmortgage.com

I was working with a broker who promised me the lowest possible rate. Near closing, I made a few cold calls to other brokers. I went with another broker who offered 1/4 point less after spending months doing paper work with the first guy. Shop around when you have a closing date. You are the one who will ultimately pay for the mortgage FOR 30 YEARS. We closed within 2 weeks of my first conversation with the new broker. My old broker collected no fees from me.

hello...sunny_hong@countrywide.com

and no you do not have to keep your mortgage broker...in our business, you win some and you lose some...

Yep, you can even leave your broker even after you have locked in. I think most brokers would give you a better deal since it'll be a quick buck for them. Just make sure you have your paperwork organized. I'd say do it if you'll save 1/4% or more. You may lose some fees and you'll possibly have to pay for another appraisal if the new bank doesn't have a history with the first lender's appraiser. There is risk involved in case your paperwork doesn't satisfy the new lender or if the first bank holds your UCC1 hostage for coops. The best thing to try to do is to negotiate with the person who you're working with.

Also, if rates go down, it should cost nothing to break a previous lock and get a lower rate. Don't let anyone tell you otherwise or let them charge a fee to break a lock. It's free. They'll do it if they want to do it.

Thanks. I felt so committed and after hearing your responses, I don't know why it wasn't more obvious that it's my responsibility to show around. In the end I'm the one who pays. I just feel bad because the broker is a nice guy. But something tells me that whoever his contacts at banks were, they are no longer there. I did sign a contract... but I think it was a standard one saying that I would owe fees if the bank didn't cover his fee. Seems like banks today don't want to cover his fee.

What's the point of mortgage brokers anyway? Can't I just do all the same work myself?

I don't think you should drop your broker, especially since he has been working on you behalf for almost a year. Im certain that you have spent hours speaking with him and used up plenty of his time.He deserves to be compensated. You want a fixed rate, but are you prepared to hear the rate associated with the product? The brokers business is to know which lender and program suits you best. Chances are if hes steering you toward the 5yr, the rate is substantially lower than the 30yr. Dont you think there is a reason he is pushing the 5yr, especially since you know hes not making money on the rate so it doesnt affect him whatsoever?

If you think you can do better yourself, good luck. Its a jungle out there. I have deals denied from lenders that you wouldn't believe. You may be shooting yourself in the foot if you jump ship at this point. Dont be so quick to blame the borker.

borker/broker same think :)

This is business. It isn't personal. If the broker gets you what you want, he's done his job. If not, move on. Period. 3-year arm? Insane.

I dropped my first broker like a cheating bitch cuz he couldn't deliver. Your broker wasted YOUR time and should compensate YOU! I'd go for the lowest rate. A 1/4% on a $400k loan is about $100/mo. Yes, as I said, there is risk involved and you have to make sure your paperwork is in order and that you're qualified. Don't get played for a fool by your broker. Let us know what happens.

I am working witha broker - but I told him that I might be shopping around as well. and he sounded cool about it. so he is aware that if i find a better deal somewhere else, I will ditch him for that inspite of all the work and effort he and his team has done for me. except that I am yet to find a better deal than what he has offered.

^^ I agree completely, if the broker isnt getting the job done you should definitely ditch him. From the way I read your comments, it doesnt seem like hes not doing a good job, hes just not telling you what you want to hear. What rate did he quote you on the 5 yr and what rate do you think you are going to get on a 30yr? There is often a disconnect between what the client (Junniper89) wants and what is reality.

Well lets talk about the push towards a 3 year ARM... Does anyone really think refinancing in three years is a good idea? Interest reates are low and probably gonna get even lower by the beginning of next year (my building will probably not close until early spring). So, isn't the way to go to get a 30 year fixed? I think the time to get a good deal in now, not later.

the 3 yr is no good. Whats the 5yr rate hes offering and whats the 30yr fixed rate you think you can obtain?

Any ARM isnt great especially a 3 year unless you know for sure that you wont hold the property for that long. However, theres no guarantee you will be able to sell it nor refinance when the adjustment period comes. Fixed is the way to go unless there is a huge spread betwen the ARM and Fixed. However, the spread between fixed rates and ARMs arent much nowadays.

Shong, I like your posts and think that you do bring important insight to the community however; if people look back at your old posts they will see you were heavily touting ARMs because your bank didn't offer fixed rate products. Now all of a sudden BOA has shifted from arms to fixed rates and now you are pushing the fixed hard. If you really want to be an asset to this community be impartial, don't just try to make a buck.

The spreads are not tremendous but on a $1mil loan the difference between 5% on a 5 yr and 6% on a 30 yr is a substantial amount of money even though the rate spread is not great.

mbroker, I agree with what you are saying about being impartial. However, our spreads between the ARMs and Fixed was huge at the time. And Ive always said the ARMs can make sense for some people. BOA and Countrywide didnt merge until July. Yes, we have shifted towards improving our fixed products since the merger. But if our ARM rates were 6% and our jumbos were 8% like they were few months back, then I would still be pushing the ARMs. The savings over time can make sense to take the risk. Generally, I think ARMs arent great and especially not for everybody. I appreciate your honesty and will take your advice. But Im definitely not trying to make a quick buck. This isnt just a job for me. Its my career.