Comments on: Second Opinions on Good Faith Estimates http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/ Seattle's Leading Resource for Real Estate Information Sat, 21 Nov 2009 06:01:18 -0800 http://wordpress.org/?v=2.8.4 hourly 1 By: The Problem with Good Faith Estimates | Rain City Guide | A Seattle Real Estate Blog... http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-141230 The Problem with Good Faith Estimates | Rain City Guide | A Seattle Real Estate Blog... Sun, 27 May 2007 16:06:24 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-141230 [...] Some LOs may hide a prepayment penalty on the Federal Truth in Lending (a prepayment penalty does not show the Good Faith Estimate).   [...] [...] Some LOs may hide a prepayment penalty on the Federal Truth in Lending (a prepayment penalty does not show the Good Faith Estimate).   [...]

]]> By: Rhonda Porter http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135997 Rhonda Porter Wed, 16 May 2007 21:41:01 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135997 Thanks, Ardell! Min, I just checked rates and 5.75% will cost you in points. If you haven't locked that rate in yet, talk to your Loan Originator to see if the rates have changed. Thanks, Ardell! Min, I just checked rates and 5.75% will cost you in points. If you haven’t locked that rate in yet, talk to your Loan Originator to see if the rates have changed.

]]> By: Rhonda Porter http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135986 Rhonda Porter Wed, 16 May 2007 21:20:49 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135986 Min, I had an answer go into RCG's stealth spam trap...I'm hoping someone will fish out my response to your question soon. :) Min, I had an answer go into RCG’s stealth spam trap…I’m hoping someone will fish out my response to your question soon. :)

]]> By: Rhonda Porter http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135984 Rhonda Porter Wed, 16 May 2007 21:15:44 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135984 Hi Min, I actually did a post recently here at RCG regarding LPMI, PMI and piggy back mortgages. There are examples of how the rates compare: http://www.raincityguide.com/2007/05/11/lpmi-pmi-and-8020-mortgages%e2%80%a6oh-my/ Your rate is going to be determined a great deal by your credit score with the my community and lpmi products. There is also Fannie Mae Flex which could also be one loan with or without buyer paid mi. There's buyer paid (lower rate w/mi) and lender paid mortgage insurance (rate should only be approx. 0.25 - 0.375% higher with 10% down). And there are pros and cons with each scenario. As far as which route you should take with your financing depends on several factors. Ardell's touched on one of them. 1. How long do you plan on staying in this home? 2. How long do you plan on retaining this mortgage? 3. Do you forsee coming into cash to paydown the second (if that's what you want to do with your cash). 4. Do you have other long term financial goals with your funds? 5. Your income will also determine which programs you qualify for. My Community has income limits; Flex does not. Definately get a second opinion to compare BOAs product (or any lenders) apples to apples. Often times, "no cost" means "higher rate". Here's another post I did for RCG regarding GFE's: http://www.raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/ Hi Min, I actually did a post recently here at RCG regarding LPMI, PMI and piggy back mortgages. There are examples of how the rates compare: http://www.raincityguide.com/2007/05/11/lpmi-pmi-and-8020-mortgages%e2%80%a6oh-my/

Your rate is going to be determined a great deal by your credit score with the my community and lpmi products. There is also Fannie Mae Flex which could also be one loan with or without buyer paid mi.

There’s buyer paid (lower rate w/mi) and lender paid mortgage insurance (rate should only be approx. 0.25 – 0.375% higher with 10% down). And there are pros and cons with each scenario.

As far as which route you should take with your financing depends on several factors. Ardell’s touched on one of them.
1. How long do you plan on staying in this home?
2. How long do you plan on retaining this mortgage?
3. Do you forsee coming into cash to paydown the second (if that’s what you want to do with your cash).
4. Do you have other long term financial goals with your funds?
5. Your income will also determine which programs you qualify for. My Community has income limits; Flex does not.

Definately get a second opinion to compare BOAs product (or any lenders) apples to apples. Often times, “no cost” means “higher rate”. Here’s another post I did for RCG regarding GFE’s: http://www.raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/

]]> By: ARDELL http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135964 ARDELL Wed, 16 May 2007 20:45:28 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135964 Min, Is there any possibility that you will be able to pay off 12% to get to 20% down and get rid of the pmi in the next few years? If you have no PMI you can't get the rate back down that 1/2 of a % without a total refi, which is costly. If you are planning to carry the 90% LTV for many years,then only getting a guarantee of deductibility for 2007 doesn't do a lot for you. The last client I had did the two loans because they fully intended to, and had the ability to, pay off the send loan within a year to 18 months. Min,

Is there any possibility that you will be able to pay off 12% to get to 20% down and get rid of the pmi in the next few years? If you have no PMI you can’t get the rate back down that 1/2 of a % without a total refi, which is costly. If you are planning to carry the 90% LTV for many years,then only getting a guarantee of deductibility for 2007 doesn’t do a lot for you.

The last client I had did the two loans because they fully intended to, and had the ability to, pay off the send loan within a year to 18 months.

]]> By: Min http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135937 Min Wed, 16 May 2007 19:41:43 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-135937 Hi, I would like to buy a condo and put 10% down. How do you access a 30 yrs fixed my community loan, currently 5.75% rate, vs regular 30 yrs fixed rate of around 6.25% (for example bank of usa has no closing cost and PMI now). Or is it better to get two mortgages to avoid PMI. My community has PMI, yet it is deductible at least for 2007. Thanks Hi,

I would like to buy a condo and put 10% down. How do you access a 30 yrs fixed my community loan, currently 5.75% rate, vs regular 30 yrs fixed rate of around 6.25% (for example bank of usa has no closing cost and PMI now). Or is it better to get two mortgages to avoid PMI. My community has PMI, yet it is deductible at least for 2007.

Thanks

]]> By: Bribery to Work with the Builder’s Preferred Lender | Rain City Guide | A Seattle Real Estate Blog... http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-132066 Bribery to Work with the Builder’s Preferred Lender | Rain City Guide | A Seattle Real Estate Blog... Sun, 06 May 2007 21:29:45 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-132066 [...] This is just another example of why you should get second opinions on your Good Faith Estimates.   Especially if you’re being steered to use a lender who essentially works for the Seller/Builder.   If you are considering the “builder bait”, do get a complete good faith estimate to compare to what your Mortgage Professional is offering before you get “hooked” by the credit.   [...] [...] This is just another example of why you should get second opinions on your Good Faith Estimates.   Especially if you’re being steered to use a lender who essentially works for the Seller/Builder.   If you are considering the “builder bait”, do get a complete good faith estimate to compare to what your Mortgage Professional is offering before you get “hooked” by the credit.   [...]

]]> By: 5 Steps to Shop for Mortgage Interest Rates | Rain City Guide | A Seattle Real Estate Blog... http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-116331 5 Steps to Shop for Mortgage Interest Rates | Rain City Guide | A Seattle Real Estate Blog... Thu, 29 Mar 2007 14:08:19 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-116331 [...] Don’t forget to ask the LO to email or fax the Good Faith Estimate and Federal Truth in Lending to you as soon as possible (this means you will need to provide them with your email or fax information).   Ask the LO if they guarantee their closing costs.   Let them know you like to bring your GFE to your closing appointments to compare it the estimated HUD-1 Settlement statement. Step 5:   Review the good faith estimates.  (Are we having fun yet?)   Lines 800 – 823 are the closing costs associated with the rate.    If your transaction is a purchase, there are also title and escrow charges (these charges exist with a refinance as well).  The title and escrow fees (section 1100) on the good faith estimate are just that, an estimate since the companies who will be providing that service will be set forth on the purchase and sale agreement.    You do not need to shop by what the lender is showing for reserves (prepaid interest, taxes and insurance).  These are not closing costs and the amounts of reserves are set based on when your first mortgage payment will be due.   Some loan originators might reduce the amount of prorated interest to try to make their closing costs look less.  (Unless I know when you’re closing, I show 15 days of prorated interest on my good faith estimates.   I’d rather be higher with my estimates to start with and have you happy with me at closing).   Again, you’re really most interested in comparing the cost show on lines 800 – 823 in relationship to the interest rate (not the APR) on the Good Faith Estimate.   When I’m working with a “rate shopper” I’m happy to help review the good faith estimates (in fact, if I’m being shopped, I’d rather just have the other estimates faxed or emailed to me and I’ll confirm if I can better the rate or closing costs).     [...] [...] Don’t forget to ask the LO to email or fax the Good Faith Estimate and Federal Truth in Lending to you as soon as possible (this means you will need to provide them with your email or fax information).   Ask the LO if they guarantee their closing costs.   Let them know you like to bring your GFE to your closing appointments to compare it the estimated HUD-1 Settlement statement. Step 5:   Review the good faith estimates.  (Are we having fun yet?)   Lines 800 – 823 are the closing costs associated with the rate.    If your transaction is a purchase, there are also title and escrow charges (these charges exist with a refinance as well).  The title and escrow fees (section 1100) on the good faith estimate are just that, an estimate since the companies who will be providing that service will be set forth on the purchase and sale agreement.    You do not need to shop by what the lender is showing for reserves (prepaid interest, taxes and insurance).  These are not closing costs and the amounts of reserves are set based on when your first mortgage payment will be due.   Some loan originators might reduce the amount of prorated interest to try to make their closing costs look less.  (Unless I know when you’re closing, I show 15 days of prorated interest on my good faith estimates.   I’d rather be higher with my estimates to start with and have you happy with me at closing).   Again, you’re really most interested in comparing the cost show on lines 800 – 823 in relationship to the interest rate (not the APR) on the Good Faith Estimate.   When I’m working with a “rate shopper” I’m happy to help review the good faith estimates (in fact, if I’m being shopped, I’d rather just have the other estimates faxed or emailed to me and I’ll confirm if I can better the rate or closing costs).     [...]

]]> By: Rhonda Porter http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-115690 Rhonda Porter Wed, 28 Mar 2007 13:45:22 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-115690 True Gina. I'm often surprised how many borrowers are not provided a GFE from a lender who has quoted a mortgage interest rate. True Gina. I’m often surprised how many borrowers are not provided a GFE from a lender who has quoted a mortgage interest rate.

]]> By: Gina http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-115515 Gina Wed, 28 Mar 2007 05:15:46 +0000 http://raincityguide.com/2007/03/25/second-opinions-on-good-faith-estimates/#comment-115515 Loaning should be done with all considerations. As much as possible, discover every truth about your transactions and the strings that are attached. It will be difficult to stand your ground if you're not careful. Loaning should be done with all considerations. As much as possible, discover every truth about your transactions and the strings that are attached. It will be difficult to stand your ground if you’re not careful.

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