A you combing the Internet for the best refinance rates online only to find junk fees and empty promises? The web can be an excellent resource for comparing refinance rates online; however, nearly all of the mortgage offers you find online include unnecessary markup for someone’s bloated commission. Here are several of my best mortgage tips to help you make sense of refinance rates online and spot a good offer when you find one.
Comparing Refinance Rates Online
You probably approach mortgage shopping the same way as many of your neighbors, collecting Good Faith Estimates and rate quotes from various websites you encounter online. What you may not know about the Good Faith Estimates and rate quotes you collect on and offline is that they all include unnecessary markup and fees to create an “extra” commission for someone at your expense.
Yes, I am referring to the so called “lender paid” compensation that many mortgage brokers are quick to point out isn’t coming out of your pocket. Au contraire, what you need to know is why your lender would pay the mortgage broker or website a fee for your loan. After all you’re paying this person a perfectly reasonable origination fee for their services in arranging your home loan, why would the mortgage lender pay extra on top? The answer lies in what’s in it for mortgage lenders. You see, these mortgage lenders make the majority of their profit selling your loan to various investors on the secondary mortgage market. These investors pay top dollar for mortgage loans with higher than necessary mortgage rates. Because of this premium mortgage lenders reward mortgage brokers and companies that lock and close their home loans with higher than necessary mortgage rates which results in a higher than necessary mortgage payment for you.
Mortgage Yield Spread Premium
This commission driven markup of your mortgage rate is known in the business as Yield Spread Premium. For every .25% that you unknowingly agree to overpay the person or website arranging your loan pockets an additional one percent of your home loan amount. This is paid of course in addition to the loan origination fee that they’re probably also overcharging you. How common do you think this practice of mortgage rate inflation for hire is today? It’s so widespread that nearly every single one of your neighbors is currently paying too much for their home loan and so bad that according to the Secretary of Housing and Urban Development American homeowners will overpay sixteen billion dollars this year alone. Let your neighbors pay this; you’ve got better things to do with your money.
Comparing Refinance Rates The Right Way
Collecting mortgage rate quotes from dozens of mortgage brokers and websites will only get you a bunch of marked up, overpriced home loans. The secret to getting the lowest mortgage rates, also known as wholesale or par mortgage rates is to find the right person to originate your home loan. Once you’ve found the right person to arrange your mortgage the unnecessary markup and junk fees take care of themselves.
Who’s the right person to arrange your next home loan? I can tell you for starters who the right person isn’t. Banks for one are the wrong people because they don’t play by the same rules as other mortgage originators thanks to a loophole in disclosure laws. Mortgage brokers that employ expensive sales staff and work out of posh office spaces aren’t going to be willing to negotiate the kind of deal you’re looking for because of their costly overhead. What about the mortgage broker with their face and/or logo splattered all over their brand new hummer? Forget about it, how do you think they paid for that hummer? Not by helping homeowners like you secure honest financing for their homes you can be sure of that…
You can learn more about finding the right person to arrange your next home mortgage loan without paying unnecessary markup or junk fees for someone’s commission by checking out my free underground mortgage refinancing videos.
Here’s a sample of what you’ll get when you register today…this module is about your mortgage lender’s dirty secret and why 90% of your neighbors today pay too much for their home loans.