Mortgage Broker Fees - Posted by Fred(NY)

Posted by JohnBoy on January 28, 1999 at 14:38:37:

Check out this site. And be sure to read the section on “letters”, especially the one to equifax. LOL.

http://www.creditscoring.com/

Mortgage Broker Fees - Posted by Fred(NY)

Posted by Fred(NY) on January 28, 1999 at 09:21:23:

What is the typical fee charged by a mortgage broker on a loan. I just recieved a good faith estimate and as usual the numbers are different from what she told be over the phone. A fees that really stands out is 5%(of the loan) commission. This seems pretty high. The advantage of using this broker is that she is FAST. Average turn around on a mortgage loan is 2-3 week from intro to CLOSE. My credit situation is GOOD, Income is GOOD, rate is 9.5% - 10% not that good…

Any comments???

OK, so I’ll ask. What is your definition… - Posted by FJW

Posted by FJW on January 29, 1999 at 10:36:19:

of GOOD? I’m a new mortgage broker in FLA, and I’ve met a lot of potential borrowers who think their credit is good, and perhaps it is, but for various reasons, their credit score is low, which no matter how you feel about the issue, is going to dictate the rate counter-offer from the lender. There’s also owner occupation, debt ratios, LTV, and documentation that affect the rate.
Another issue is the amount of the loan. To a lender and a broker, a loan is a loan, same amount of work, big or small. So small loans get hit harder with fees percentage wise because no one’s going to do it for peanuts.

So, yeah, it seems like a lot, but I’ve got to ask: What’s the rest of the story?

FJW

Re: Mortgage Broker Fees - Posted by Laurie

Posted by Laurie on January 28, 1999 at 22:40:08:

Fred,

I am a mortgage broker and was wondering if you could tell me some details on the loan. If its a small loan amount,or no money down, or any kind of a special loan points most likely have to be charged. I don’t know about 5 %. If you credit is good and your income is good the rate should be good and it’s not! Even investment properties today you can get them for under 8%. Please give me some details on your situation and I can tell you why I think your being charged this.

Laurie

Re: Mortgage Broker Fees - Posted by James Lane

Posted by James Lane on January 28, 1999 at 10:18:46:

Speaking from a mortgage broker’s point-of-view, the one thing that drives a broker crazy(one who wants to make 7 points on every deal) is a well informed, “willing to look” around customer. My advice is to take your 1003 loan application and a copy or your credit report(full merged report from all 3 bureaus with credit scores)and just make an appointment with a few mortgage companies. I say to take you own 1003 and credit report so that the mortgage brokers don’t pull your credit. You don’t want a dozen or so brokers pulling down your credit score. This will also show them you know how to play the game, so have fun during the process and ask a lot of questions.

What you want to compare is the RATE (it you really want to mess with them, ask them if this is a PAR rate or does it include a yeild spread premium – thats $$$ in the back for the broker, Fixed or Variable Rate, Term (fixed, balloon), LTV, origination fee (you should not pay more than 1 or 2 points if you are a GOOD credit risk), pre-payment penalty, lender fees (I’ve seen them charge up to $1K doc prep fee, and documents required.

Asking these questions will save you thousands. It amazes me how many people don’t do comparitive shopping when they want to get a mortgage, but they will drive 2 hours to buy an iteam because they will save $5.

James Lane

WOW! - Posted by karp

Posted by karp on January 28, 1999 at 09:38:26:

Fred, I am a mortgage broker licensed all over and I can tell you, if your credit and all that is GOOD, that a 5% origination fee along with the SPREAD she is making on the back(2-4pts)is way unreasonable.

Figure, if your situation is that GOOD, she could run you through desktop underwriting, get your approval in a day, and close it in a week, no sweat.

I thinkit is worth asking her what is going on. You may be suprised by the answer.

Good Luck,

karp

aka
Karl Hartley
Total Quality Mortgage

Re: Mortgage Broker Fees - Posted by Fred

Posted by Fred on January 29, 1999 at 14:37:47:

Here are the approx loan details. 65K property, 80% LTV for 51K. 14K paid to seller. Property is being assigned (Flipped)to me.

Re: Mortgage Broker Fees - Posted by Fred(NY)

Posted by Fred(NY) on January 28, 1999 at 10:41:54:

Before I talk to the I’d like to get as much input as possible. The good faith form has a section #811 for application fee and the broker has added an additional line for “Processing Fee”. Is there really a difference?

Re: WOW! - Posted by Fred(NY)

Posted by Fred(NY) on January 28, 1999 at 09:46:51:

Thanks for the quick response KARP. Where do the points come in to play. I understand the origination fee but I’m not following the point system, can you offer any insight? What’s a typical origination fee? and other fees?

Also, being that you’re a mortgage broker what would you tell REI to look out for when dealing dishonest or misleading Mortgage brokers?

Thanks

Re: Mortgage Broker Fees - Posted by David(Ca)

Posted by David(Ca) on January 28, 1999 at 12:18:43:

Fred,

An “Application Fee” is paid upfront, a “Processing Fee” is paid when the loan closes. Very few lenders/brokers charge an application fee.

Dave

Another Mortgage Broker, please chime in! - Posted by karp

Posted by karp on January 28, 1999 at 09:59:59:

Wow. That is a huge question. AND a good one.
Let me suggest first doing a search on the web.
There was this lady who I really liked who had the world’s largest chip on her shoulder re: FICO scores, points and all that crap…I will try to post her website when I remember it.

Dishonest and Misleading Mortgage Brokers? Dude, we a re all dishonest, misleading and incompetant. It is part of the job description. Your job description is to keep us in line and not get burned.

I have a stomach flu and feel like hell so let’s hope another Mortgage Broker is around and can help address these very good questions. I will check back later…

Good Luck,

karp

You HAVE to be talking about www.bayhouse.com!(nt) - Posted by John Butler(Stl)

Posted by John Butler(Stl) on January 28, 1999 at 11:00:37:

nt

BINGO! I love that site…LOL (nt) - Posted by karp

Posted by karp on January 28, 1999 at 11:32:17:

nt