I receive several calls daily inquiring about our services. Many are first-time home buyers and they always start off by asking if there are any first-time home buyer programs available. Then the next question is “what are your rates right now and what are your fees?”
This is such an ambiguous question. Seriously. A mortgage rate varies depending on loan program (FHA, VA, Conventional, USDA, Jumbo), terms (30 yr. fixed, 15 yr. fixed, ARM, etc.), FICO score, amount of down payment, etc. Do you even know if you should be looking for an FHA or Conventional loan? Do you know the difference between the two? Plus there are other factors, such as do you need down payment assistance (DPA) or are you purchasing in a rural area? These can greatly affect loan programs and ultimately are going to affect the rate and even fees. A better question for a lender is “do you offer multiple loan programs?” And “are you experienced with multiple loan programs?”
The main point I’m trying to get across is that don’t be so quick to be asking about rates and fees without knowing what you’re really looking for in a lender. Rates and fees are going to be fairly competitive and should not vary significantly (plus or minus) and if they do that should be a red flag. You need to be aware that not necessarily the lowest rate and/or fees in a lender will equate to the best service or quality of service. My question to you would be “what are you looking for in a lender?”
The importance should be trying to find a lender you feel comfortable with, one that you can talk with and understand, someone who will help guide and educate you, especially if you’re a first-time homebuyer. You will want someone who is versed and experienced in multiple loan programs. Don’t let a lender discourage you away from a specific loan program unless they have definitive reasons. You don’t want to be steered away from a specific loan program just because they can’t provide the loan program or because they are not familiar with or uncomfortable with the loan program. Inexperience or feeling a loan program it too complicated is no reason to not offer a program.
Do your research, make calls and ask questions. But be mindful when you ask what are your rates and fees. If you don’t provide needed information and many times financials, don’t expect the rate that is quoted over the phone to be the exact rate you will receive once you go through the pre-approval process. If you’re rate shopping you doesn’t do a service to yourself.
If you have any questions please give us a call.
