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robbrown robbrown
 

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 M¢25  Funded By Mahalo ? |  August 25, 2009 08:25 PM

What are some tips that you would give to a first time home buyer looking to get a mortgage?

"Real Estate Crisis" is echoed in the minds of many would be home buyers. Many people who are looking for a new home also require a new mortgage.

What advice would you give someone who was looking for a new mortgage for the first time today?
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soundboy soundboy
 
 August 26, 2009 12:36 AM
I just bought a condo so I have some experience with mortgages. I would recommend keeping an eye on the rates over time. Sites like bankrate.com will show you graphs and local percentages for each kind of loan.

It's hard to lock it in at a good rate because you really have to wait until you are actually ready to get a mortgage. This means you have to find the place you are looking for, make an offer, have that offer accepted, do inspections, appraisals... All of this takes months so you just kinda have to hope the rates are low once you are applying for the mortgage.

Get a few quotes from different places and see who has the lowest rate. Get recommendations from your realtor. Most realtors work closely with mortgage companies.

Know that you will have to pay thousands of dollars in closing and title fees. This is a killer. Even when you have a good faith estimate for your final costs, the actual final costs will be more. Why? They just are because they can charge you a bunch of ridiculous fees and at this point there is not much you can do about it except walk away.

For a good rate it will help to have excellent credit. There are different options when it comes to choosing a mortgage and it is a good idea to have the mortgage broker explain all the details about each one so you can pick the one that is best for you.


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cheapgamer cheapgamer
 
August 25, 2009 08:49 PM
research, research, research . . .

Use personal contacts and the internet to find out who to go to for your mortgage. I personally went through this and the amount of information that is available is stunning so I find it best to find someone who has lots of personal &/or professional experience with Mortgage brokers

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robbrown robbrown
 
August 25, 2009 08:50 PM
Any tips on where to find good Mortgage info online Cheapgamer?

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cheapgamer cheapgamer
 
August 25, 2009 09:35 PM
Thankfully I had family members in the buisness so most of my advice was face to face.

One site I really like is the one below as it is from the fedral reserve and therefore unbiased to specific lenders.

http://www.federalreserve.gov/pubs/mortgage/mortb_1.htm
https://www.federalreserve.gov/apps/mortcalc/

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niche niche
 
August 25, 2009 08:52 PM
Read the smal print
Make sure you get a mortgage you can afford
Shop around before you decide on which mortgage to go for

Tags: mortgages

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aleghart aleghart
 
August 25, 2009 09:03 PM
Mortgage brokers have no loyalty to you. In the U.S., they do not have a fiduciary obligation. A doctor or lawyer must act in your best interests. A mortgage broker has no such caveats.

We had a great broker. Nice. Personable. Meticulous, even to the point of advising us on income tax deductions and calculating for a better take-home without owing anything.

Then, at the moment of signing, a new contract was put in front of us. We were told...because of the changing economic conditions, the mortgage company is asking for 0.x% higher rate. It was small on a monthly basis, so we signed.

The offered ate was still valid. They did not disclose that we had the choice to say "No" and demand the original contract back on the table.

We found out later that this is a common tactic used. The mortgage company pays a bonus back to the broker for what amounts to an up-sell. They take the cash value of the extra interest an give the broker a share.

There is no fine print for this. The contract is physically taken off the table. A new one with the higher rate is put in its place, and the broker will hand you a pen.

It's legal. It's dishonest.

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Voted as best: bbrookin
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robbrown robbrown
 
August 25, 2009 09:09 PM
OMG - that is crazy!

Do you happen to have a link to a blog article or similar where this is either documented or it has happened to someone else?

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aleghart aleghart
 
August 25, 2009 09:34 PM
search for the term "yield spread premium". You'll find lots of info.

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cheapgamer cheapgamer
 
August 25, 2009 09:37 PM
So sorry to hear about your experience. That is brutal. . .

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aleghart aleghart
 
August 25, 2009 09:56 PM
Still ended up with a great loan. Just sad to know that it could have been better.

We would never have known if the broker never showed us the lower rate to begin with.

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ling ling
 
August 25, 2009 11:49 PM
My advice is for that person to get to the library and borrow a much books as one can and read about first time home buying. Another program to look into is to see if your county has the first time home buyers classes.

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