Should we shop at around at diffrent banks for mortgage rates?
Posted by admin | Under Mortgage Rates Monday Oct 20, 2008My husband and I are first time home buyer's. We didn't kow if it was better or worse to let several banks run pre-approvals. I wasn't sure if it would hurt our credit for a bunch of diffrent people to pull up our history. I want the best rate but I don't want to harm our rating. What is the best route to take when looking for a mortgage?
Why don't you just ask for their rates without having them run your credit history? That's what I do.
lending tree.com
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Yes, because they vary.
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Why don't you just ask for their rates without having them run your credit history? That's what I do.
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shop for rates by calling around and check your credit
reports and pay for the SCORES so you have an idea
creditinfocenter com
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It is a myth that getting your credit run multiple times for a mortgage will damage it. The truth is that with the FICO system, as long as it's being run in conjunction with a mortgage, you can have it run as many times as you want within a certain time frame. Some say it's 30 days and some say it is 45, I'n not sure, but what I am sure of is that for at least 30 days you are allowed to shop around.
That being said, why don't you just go to a broker? Any good broker will have associations with all the major lenders and can tell you what their rates are, in fact, brokers get discount rates from lenders like Countrywide, WAMU, B of A and other large companies. These are not rates offered to you. When you walk into the institution you are being offered a retail rate, when brokers get wholesale rates. Brokers "shop your loan" to many many different lenders. There has been so much "Broker Bashing" lately that it seems people have forgotten that it's far best to use an experienced broker when dealing with the largest purchase you will probably ever make.
Take my advice, have a broker do the leg work for you, a good broker will save you time AND money in the long run. Get a broker approved with all the names you know in the business.
Edit:
Daniel asks why not just ask the rates without having them run your credit history.
Answer: because people will tell you the lowest rates possible and at times the lowest rates not possible. They will "lowball" you trying to get your business.
Anyone quoting you a rate without an explanation of what it takes to qualify for the rate is breaking the law. You also CANNOT quote a rate if you are not licensed.
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http://WeFixRates.Com
I'd have to agree, I'd find a reputable broker. They keep the predatory lenders away & are very helpful when it comes to explaining the terms & conditions of the potential mortgage.
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Yes, inquire about rates, but do not have anyone run a credit report for a pre-approval until you decide which lender to use.
You need to ask several questions when you inquire about rates: THE RATE, THE POINTS, THE CLOSING COSTS.
A point is 1% of the mortgage amount. You can buy down the rate by paying one or more points. If you pay less points or no points at all, your rate will be a little higher. So you need to know the rate and the point(s) associated with it.
The closing costs include any points you are paying, plus a variety of other costs, including prepaid interest, and fees for property appraisal, title search, title insurance, processing fees and a variety of other possible expenses. Ask the lenders for a G F E (good faith estimate) of all the details of their closing costs. The closing costs can vary widely from lender to lender.
They can fine tune their rate & points for you, based on your credit report & score, after you decide who you are comfortable with, and who you will ask for a pre approval.
Check at both Banks & Mortgage Companies. Ask a lot of questions and don't let anyone rush you into anything. AND be sure to get a Fixed Rate mortgage. It is a buyers housing market and it probably will be for the next year or two. So, you don't have to rush.
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Retired Banker, now a Realtor
you know what i did when i bought my house last year i got a copy of my credit report from the 3 agencies and then i took those with me to the lenders and i showed them how much i made what debts were on my report and my credit score. a good lender will know how to work with this and give you an estimate and give you some rate quotes. once i found someone i was comfortable with i let him pull my credit and then give me that preapproval. each time someone pulls your credit it knocks out about 6-7 pts and you know when you have border credit those few pts mean a lot. oh yeah you get one free report from the agencies every year
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Yes, it is a good idea to call around to see what loan programs and rates different lenders are offering. You can call and have them to run a good faith estimate and truth in lending disclosure as well without them pulling your credit. This will be hypothetical because your rate is based on several factors including your credit score. You also need to inquire if these lenders offer 1st Time Home Buyer loan programs. Many states offer special programs at lower rates if you haven't owned a home in the past 3 yrs. Only approved lenders by the state can offer these.
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