Mortgage Price Quotes
Rates and points quoted by loan providers. You cannot safely assume that mortgage price quotes are always timely, niche-adjusted, complete, or reliable. Timeliness: Most mortgage lenders change their prices daily, generally in the morning after secondary markets open, and sometimes they will change them during the day as well. This is a major problem for shoppers using traditional distribution channels, since prices collected from lender 1 on Monday and from lender 2 on Tuesday will not be comparable if the market has changed in the meantime. Niche-Adjusted: Most mortgage price quotes are based on the most favorable assumptions possible about your niche. Niche-adjusted prices are available from a loan officer by volunteering the information needed to determine the correct price. Usually, the loan officer will ask you to fill out an application in the process, which makes it difficult to shop. The easier way to shop niche-adjusted prices is at Web sites that offer a 'customized' price. To receive it, you must first fill out a form that provides the required information about your deal, but you don't have to apply. Multiple Web sites can be shopped in one sitting. Completeness: Most price quotes consist of rate and points only. They omit fixed-dollar fees, and on ARMs they also omit features that affect the ARM rate after the initial rate period ends. Reliability: A reliable price quote is one that, assuming the market does not change, the loan provider intends to honor when you lock. Some loan providers offer low-ball quotes they have no intention of honoring. The objective is to rope you in. They figure that once you are in the application process, they have a good chance of landing you as a borrower. If you are purchasing a house, the cost of terminating the process with one loan provider and starting again with another becomes increasingly high as you move toward the home closing date. Your bargaining power recedes with the passage of time.
Popular Mortgage Terms
Someone authorized by the original credit card holder to use the holder's card. While authorized users are not responsible for paying any charges, including their own, they are sometimes ...
When a borrower has difficulty making the scheduled payment. Position of the Lender: A good place to start is by understanding the position of the lender. A game plan for survival ...
Fees collected by a loan officer from a borrower that are lower than the target fees specified by the lender or mortgage broker who employs the loan officer. An underage is the opposite ...
Acceptance of the borrower's loan application. Approval means that the borrower meets the lender's Qualification Requirements and also its Underwriting Requirements. In some cases, ...
A particular computerized system for doing automated underwriting. Mortgage insurers and some large lenders have developed such systems, but the most widely used are Fannie Mae's 'Desktop ...
A second mortgage offered at preferential (subsidized) terms to those who qualify. For example, a labor union may offer members who are first-time home buyers a silent second to finance ...
The number of months for which the initial interest rate holds on an ARM. ...
Mortgages delivered using the Internet as a major part of the communication process between the borrower and the lender. ...
The ratio of total housing expense to borrower income. This ratio is used (along with other factors) in qualifying borrowers. ...
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