Welcome to RPM Mortgage Inc.
TODD GALDE
“How come rates are sometimes SO much lower in advertisements?” Oh, if I only had a nickel for every time I’ve been asked that question! Rob Chrisman’s weekly answers this question:
It is easy to quote rates out there, but every borrower should remember that their loan is different, and that often the advertised, or publicized, rates are slightly lower due to a number of factors.
First, the rates in Freddie Mac’s survey (which come out every week) include average discount points paid for the mortgage. Points, people, points! And they “hide” them at the very end of the article, like the really fast radio announcer on radio ads. Sneaky. But not everyone is willing to pay points: a point is 1% of the mortgage amount, charged as prepaid interest. Many of my clients do not want to pay points, and I agree because unless you’re going to live in your home for a very long time, paying points often doesn’t make sense.
The second reason that your rate might be different than a rate you hear on the radio or read in a newspaper is that your “characteristics”, or price adjustments will differ from an absolutely perfect scenario. For example, a credit score on the low side will prevent you from getting the lowest rates. Low levels of home equity will also mean a pricier mortgage rate. Focusing on LTV, for example, at least a 20% equity cushion (80% LTV) in your home for a refinance, or down payment for a purchase, will help obtain a better rate for a borrower. And if you’re looking for a jumbo mortgage ($625,000+), you will want 25% or 30% down for the best rates.
Property type also influences rates: in the current environment, liens on condos usually carry a slightly higher rate unless you want to put more money down. And if your mortgage is for a vacation home or investment property, you can also expect to pay a higher rate. So many variables, so little time… oh wait, that didn’t make any sense.
Anyways, you get the idea. The bottom line is that it’s harder today to qualify for a loan, harder than it’s ever been in the industry.
Fortunately [que the telephone booth and caped crusader], you have the Galde Mortgage Team to help you navigate these mysterious waters.
Sincerely,
Todd Galde
Mortgage Advisor
TGalde@rpm-mtg.com
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Todd Galde Mortgage Advisor tgalde@rpm-mtg.com Direct: 925.263.3087 Cell: 925.381.8190 Fax: 925.406.0826 License #01505858, NMLS #256864  
 
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370 Diablo Road, #103, Danville, CA 94526 | |