Insider Secrets - How to shop for the best mortgage deal

FREE INSIDER SECRETS...

HOW TO SHOP FOR THE BEST
MORTGAGE DEAL

My secrets include these topics:

-- THERE IS NO MAGIC TO THE MORTGAGE BUSINESS
-- PAYING LOAN FEES IS OFTEN BETTER THAN ZERO FEES
-- BEWARE OF IMPROPER CLOSING COST DISCLOSURE
-- SECRETS THAT 'BIG BANKS' DON'T WANT YOU TO KNOW
-- THE MYTH ABOUT 'BIG BANK' LOAN OFFICERS
-- HOW TO MAKE SURE YOUR RATE QUOTES ARE REAL
-- HOW TO REALLY GET THE BEST MORTGAGE DEAL

Hello...My name is Jim Walter and I am President of Mortgage Plan. My company acts as the mortgage division of several commercial banks in California... providing these bank customers with discounted home loan products.

I AM GOING TO SHOW YOU HOW TO PROPERLY SHOP FOR A MORTGAGE AND POTENTIALLY SAVE $1,000's

No...I am not selling a seminar, or tapes, or a class or anything else. If you are willing to dedicate the next 7 minutes with me, I will show you how to effectively shop the internet for mortgage financing and get the best mortgage deal for your situation. It's free with no obligation and I won't even ask you for your name or email address.

WHAT'S IN IT FOR ME?

It's simple. Hopefully you will find my information valuable and you will allow me to be one of the lenders to compete for your business. That's it!

As an industry veteran for 25 years, I think it is important that homeowners make intelligent decisions about their lending needs and not be swayed by slick salesmen, 'bait and switch' tactics, under-disclosed closing costs, and making financial decisions based on emotion.

Unfortunately, many borrowers get 'taken' when shopping for a mortgage. If I can enlighten just one homeowner with this information, I feel like I am doing something positive for my potential clients.

SECRET #1 - THERE IS NO 'MAGIC' TO THE MORTGAGE BUSINESS

Whether you apply for a loan with a bank, savings and loan, mortgage broker, mortgage banker, or credit union, the interest rates, fees, and programs should not be too much different from each other. The main difference between lenders will be the profit margin that they want to make. This influences the rates and fees that they will quote you. Later we will show you what a typical 'Good Faith Estimate of Closing Costs' should look like and how many lenders purposely 'under-disclose' these fees to make their mortgage appear appear better (at least on the surface)

So why are loans from lender to lender basically the same? Without getting into too much detail, you should know that most mortgage loans made by most lenders are sold to the same few investors who buy loans. Two quasi-government owned corporations called Fannie Mae and Freddie Mac buy a large percentage of these loans, along with other private institutions. Think of it as a funnel in which all of these lenders pour their loans into the same jar.

Therefore, the rates, fees, and terms must be uniform so that these loans can be readily sold. NO ONE HAS ANY 'MAGIC' LOAN THAT'S BETTER THAN ANY OTHER LENDER!
WARNING! Beware of lenders who promise rates, fees, or terms that sound 'too good to be true'. Those programs don't exist!
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SECRET #2 - PAYING LOAN FEES IS OFTEN BETTER THAN ZERO FEES

If all loans are basically the same from lender to lender, how do they differentiate themselves from each other? Well, it SHOULD be based on the level of customer service and expertise in evaluating your financial goals and then providing the right loan program to fit those goals.

But the reality is that mortgage companies that employ scores of telemarketers simply can't train these people in the complex world of mortgage financing. It takes years of experience to truly be able to analyze a borrower's financials and provide the best solutions. So instead, they do it with tricks.

My favorite is the one that you see on television commercials these days: 'No Points, No Fees, No Costs whatsoever'...or 'Get a loan for only $395'.

Every lender is able to originate loans with and without Points (loan fees) and/or closing costs. Remember Secret #1? There is no magic to our business? You see, loan fees and closing costs are part of EVERY mortgage loan, whether YOU pay them or someone else pays them for you. You know the fees that I am talking about...appraisals, credit, underwriting and processing fees, document preparation, title charges, escrow fees, etc.

When a lender charges no Points and/or no closing costs, what they are REALLY doing is increasing the interest rate to generate big 'rebates' from their investors. These rebates are then used to pay for YOUR closing costs, plus an amount left over for the lender's profit.

Therefore, you are PAYING these fees one way or another...either up front (or financed in your loan) or in the form of a higher interest rate!

Now...there are certainly cases when it makes sense to NOT pay Points and/or closing costs, especially if you will be paying the loan back in a short amount of time. On the other hand, if you plan to retain the loan for a period longer than 18 months to 2 years, there are clear advantages to 'buying the interest rate down' to a lower level by paying Points and/or closing costs.

BEWARE OF THE 'ORDER-TAKING TELEMARKETER' WHO CAN'T OR WON'T EXPLAIN THE ADVANTAGES OR DISADVANTAGES OF PAYING, OR NOT PAYING POINTS AND/OR CLOSING COSTS.

WARNING!Beware of lenders who won't spend the time to analyze different loan options that might benefit you
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SECRET #3 - BEWARE OF IMPROPER CLOSING COST DISCLOSURE

This is a big one and probably the most important secret! As we discussed, there are many fees to obtaining a mortgage loan. The California Department of Real Estate (who license the majority of lenders) requires that these fees be disclosed to consumers in writing! And they must be disclosed on a particular form (called the Mortgage Loan Disclosure Statement) so that consumers can easily compare closing costs from lender to lender.

BEWARE OF MORTGAGE COMPANIES WHO HIDE CLOSING COSTS TO MAKE THEIR GOOD FAITH ESTIMATE LOOK MORE COMPETITIVE!

Below I have prepared a sample Good Faith Estimate showing typical closing costs along with an explanation of who actually earns those fees. I think you will be surprised! I've based this example on a $400,000 loan at 6.500%. Know that the actual closing cost amounts vary from loan to loan. What I want you to look at is, not so much the actual costs for each line item, but to use this as a guide to make sure that lenders don't leave out or underestimate these various line items. They are all REAL costs that have to be paid by someone!

CLICK BELOW FOR AN ACCURATE GOOD FAITH ESTIMATE EXAMPLE WITH ALL FEES PROPERLY DISCLOSED...
Sample Good Faith Estimate

WARNING!Beware of lenders who try to hide their closing costs!
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SECRET #4 - THE SECRET THAT 'BIG BANKS' DON'T WANT YOU TO KNOW

Let's say that you apply for a loan with a 'big bank' and also apply for the same loan with my firm. I would be able to fund your loan through that same 'big bank' but give you a better deal than you could get directly. How? Well, larger mortgage banking firms have preferred 'wholesale' relationships with these banks and are contractually able to obtain money from them at a lower rate than they lend to their own customers!

They do this because we do all of the work in originating the loan for them. Therefore, they save money on personnel, office space, salaries, and all of the other overhead that it takes to run a retail mortgage operation.

In addition, we often have more 'clout' with these banks because we work directly with the 'back office' decision makers.

Plus, remember that the 'big banks' have a fairly limited number of loan products to offer and can only approve loans a certain way, while mortgage bankers can offer virtually every possible mortgage product available and have a lot more flexibility in approving loans.

'Big Banks' spend a lot of money on advertising to impress consumers that they are the best source for mortgage financing. What some don't tell you is that they decline up to 40% of loan applicants while mortgage bankers have a very low decline rate because of the infinite number of loan programs that they have access to.

WARNING!Make sure that you compare your 'big bank' mortgage quote with those from reputable Mortgage Bankers
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SECRET #5 - THE MYTH ABOUT 'BIG BANK' LOAN OFFICERS
Just one more thing about 'big banks'. Because they are large institutions, one would think that the loan officers who work for them would have to be more honest and experienced than private mortgage lenders.

But let's think about that for a moment. The loan officers who work for these institutions earn their income from commissions. Therefore, the incentive is to bring in loans. They face the same temptations to try to 'sell' you on a particular loan program, to perhaps under-disclose their fees, or deceive you as anyone else.

Plus, many are barely trained or just new to the loan business and may mislead you just because of inexperience. Did you know that bank-related mortgage loan officers don't even need a license or any long-term experience to do their job (hence the 40% decline ratio we talked about before)?

Of course, there are many good loan officers who work for banks. My point is that you need to be just as careful when dealing with a bank as you would with any other lender. They have the same legal requirements to disclose their fees to you in writing.

WARNING! Be as careful when dealing with 'big banks' as with any other lender

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