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dandybug
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 shayneroy
Joined: 12 Nov 2007
Posts: 51
21.08 Dollars($)
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Posted: Wed Feb 06, 2008 1:50 pm Post subject:
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"the only loan we qualify for is FHA?" That statment is a bit exaggerated one, if your credit is super low, you won't even qualify for FHA, I'm presuming your credit to be in 580's - 600's. Now, with that kind of credit scores, you certainly get good interest rate with FHA backed loans. However, you would be asked for extended escrow reserves.
From what you have mentioned, it seems that you could have qualified for 5.75 - 6.00% but your broker is not charging you the 800 series fees instead he/she's compensating the same with a higher interest rate. Hence, your closing cost is $2258 - That takes care of all the third party fees.
If you ask me, I'd say, ask for the copy of your credit report from the broker so that you know what your scores are and consider shopping with a couple of more lenders/brokers by telling them about your situation.
Make sure you compare the Good Faith Estimates, should you decide to shop around.
Hope this helps, let us know if you have any questions.
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Shayne Roy
Profolio Home Mortgage Corp.
Add : 3701 Briarpark Suite 150, Houston TX 77042.
Direct: 713-429-4304 Ext.1032 |
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dandybug
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shayneroy
Joined: 12 Nov 2007
Posts: 51
21.08 Dollars($)
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Posted: Wed Feb 06, 2008 2:46 pm Post subject:
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800 Series in the Good faith estimate consists of :
a. Loan Origination Fee
b. Discount Points Charge
c. Broker Fee
d. Cloding Coordination Fee
e. Lender Admin Fee
f. Application Fee
No, your broker lied or they don't know their stuff.
You must know this, Normally inquiries have roughly 10% influence on your credit scores that's only if you do it after 30 days from a particular pull. In short, after every pull your credit wouldn't be affected for the next 30 days irrespective of the inquiries in the interim.
Yes, the deal offered to you seems to be pretty fair because that's how an FHA loan is but I'm sure you can also qualify for a conventional loan with that credit score. In that case, the interest rate could be a bit higher However, if you have a decent amount of assests (liquid assets only) to show, you might also qualify for the best program.
All in all, I must say that the deal offered to you is pretty okay, you might want to negotiate on the interest rate with your broker, there is a scope that it can go down by 0.125 - 0.25%.
Considering your credit union wouldn't be a bad option but I'm sure you know how they work and what are their criterion for qualifying.
Good luck!
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Shayne Roy
Profolio Home Mortgage Corp.
Add : 3701 Briarpark Suite 150, Houston TX 77042.
Direct: 713-429-4304 Ext.1032 |
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michelle
Community Expert
Joined: 08 Oct 2007
Posts: 153
40.40 Dollars($)
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ckalvesmaki
Community Expert
Joined: 28 Jan 2006
Posts: 378
Location: Dallas
56.51 Dollars($)
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evolovik26
Community Expert
Joined: 15 Aug 2007
Posts: 537
Location: Minneapolis
28.93 Dollars($)
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Posted: Thu Feb 07, 2008 7:31 am Post subject:
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Our broker said our credit numbers aren't very good so the only loan we qualify for is FHA? Is that correct? Most likely not but being that this is a small loan ammount the broker can make more money on an FHA loan so that is why he told that what you need to do.
Is it normal for FHA to charge a mortgage insurance premium of $837 (rolled into loan) and than have to a monthly rate in the escrow? Yes 1.5% Upfront MI is charged on all FHA loans and the recurring monthly MI on thouse loans that are 15 yrs+ and 90% or more LTV
Is it normal to have 6 months in my escrow? Yes, up to 8 months worth of escrow can be required depending on when you doing your financing.
I thought rates where super low so why am I only qualifying for 6.5%. Brecause broker wants to make more money and looking at your rate he is making about 3.5%-4% wich is about the maximum he can make. You should be getting a rate in of around 5.75-6% and your credit got nothing to do with an FHA rate its the same for all the only difference is how much a broker wants to make and the current market.
Okay, I live in PA, my current mortgage has a pay-off balance of 40,000 and my intrest rate is 7.5% I have 20 years left to pay on a 30 year mortgage. My payment right now including escrow is 581.00.
I got an offer of an FHA at 6.5% with closing costs of $2258 and upfront costs of 2304 for escrow and cash out at 11,000 roughly bringing the new loan to 56,662 with a monthly payment about $600.
Well your closing costs should be around $4200 (that is total cost and Id really would have to look at GFE to tell you if you are being charged too much ) and what do you mean 2304 for escrow upfront? seems something fishy here. So if thouse 4200 are rolled into the loan along with $11000 cash you should be right at 56000 with a mortgage payment of $336 and MI payment of $25 roughly (add to that your taxes and insurance and you get a monthly payment)
Is this something I should look into to? I am really nervous about the monthly payment and would prefer no more than $550 and would like a better intrest rate, but not sure.
(definately get a second oppinion)
Please, any help, suggestions are so greatly appreciated!!!!
If I was a betting man, and I am  this is a classic case of greed the broker you working with found an easy target who doesnt know what he/she is doing and decided to make as much as he can. Being that this is a small amoount loan also might be what has made him want to charge more. He is trying to make more money basing it on the fact that he has to work more for less money otherwise. There can be other explanation but this one is the most likely to me. Get a second oppinion!
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Eugene Volovik
Home Loan Consultant
Countrywide
612-481-3127
Conventional, FHA and Commercial Lending in 48 states |
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gmakerley
Community Mentor
Joined: 09 Nov 2007
Posts: 12330
Location: bloomfield, ct
50.03 Dollars($)
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Posted: Thu Feb 07, 2008 10:29 am Post subject:
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all in all, i am not in disagreement with anyone specifically.
that being said, however; i think eugene is a little harsh in criticizing the lender for pricing. yes, there are variables in the rates/fees that allow for a little more income, and in all likelihood this lender has increased the rate a shade to account for that. generally, with a slightly higher rate, your closing costs are less; and vice versa - a lower rate will bring you more costs.
perhaps the rate/fees situation allows you to get a greater amount of cash back at closing. you didn't mention appraised value - not sure if that means you don't know it yet or perhaps you don't think it is relevant. it may be relevant, but since we don't know that, all of our postings are pure speculation.
at any rate, you have a fair deal going there - if you think you can do better, then you should investigate that with other lenders - again, keep in mind that some other lenders won't even be able to do an fha loan.
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George M. Akerley
Independent Contractor - Mortgage Consultant
Word of Excellence Editing/Writing/Proofreading
860-221-5044
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