Not Reviewing Your Credit Report

A very common mistake for homeowners is failing to get a copy of your credit report. By reviewing your report and FICO score in advance, you can make an effort to improve your credit rating if necessary or have any errors corrected. There are companies and knowledgeable loan consultants who will be happy to teach show how to improve your credit score, which in turn will help you save thousands of dollars in interest over the life of your loan.

Assume That You Can Shop Lender A Today And Lender B Tomorrow

Because of market volatility, prices obtained on different days are not comparable. Unless you shop all sources on the same day, you are wasting your time.

Shopping By Interest Rate Alone

If you only focus rates, you are bound to find a rogue who will beat all the other rate quotes. Those are called sales persons, or order takers, but they are not loan advisers. Those fly-by-night brokers have neither the capacity nor the intention of delivering such prices. Their objective is to rope you in and move the process along until it is too late for you to back out. At that point, he raises the price using any of a dozen tricks available for that purpose. Keep in mind that the financial market is volatile so you can’t hold a broker or lender to a rate quote until you lock the rates. A lock is the lender’s agreement guaranteeing the rates.

If someone gives you a rate over the phone, he is simply shooting in the dark because rate depends on 3 factors:

How can someone possibly give you an accurate rate when he does not have all the information?

Rates vary according to borrower information, property and transaction characteristics that lenders believe affect their risk and cost. These include loan size, credit rating, type of house, primary residence or investment, your ability to document income and assets, etc. Unless informed to the contrary, lenders quoting rates assume a set of standard specifications that generates the lowest rate. If the specs on your loan differ at all, the rate will be higher. For example, lenders assume you are purchasing a single-family home as your permanent residence. If in fact you are buying a house as an investment, your rate will be higher.

There are always closing costs when buying a home, such as escrow, title, and loan-related fees. This will vary from lender to lender and across different regions. Remember to account for closing costs. There is no such thing as a "Free Lunch". Either you pay the closing fees upfront or it will be built in in the back end and it may cost you more money.

Andre Plessis

Andre Plessis
"The Mortgage Guru"
"A Mortgage Professional whose primary goal is to provide the expertise, guidance and skills necessary to obtain the best mortgage to meet your personal needs".
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P.S. If you are at all intimidated or unsure about the mortgage process if you don’t understand how to evaluate your options in getting a mortgage loan our 15 key questions will help you feel comfortable that you are making the best decisions. Also if you are in the process of refinancing your home with anyone, CALL ME and I will let you know if you are being offered the best loan option based on market conditions and your financial situation.

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