In my opinion, choosing the best lender has become very complicated. I still have to know what makes a lender very good today and bad tomorrow.
As a borrower/buyer, you have one shot and you will be stuck with this loan for a long long while. So take the best shot at it. Or, if you intend to keep this loan for a short term, you may opt for a little higher rate, but the least expense.
As an agent representing a buyer, your livelihood depends on this lender. You wish you can build a relationship that will last forever, because you want to have a reliable, predictable loan officer that provides good service to you and to your buyer.
For the moment, I want to share with you how I shop for the best interest rate. I call this gauge, “ZERO POINT” rates.
“ZERO POINT” RATES – How do you know that you are getting the best interest rate?
For the sake of naming a subject, I coined up the above words, so I just added a new language to your vocabulary. This is my way of comparing different lenders to determine which lender offers the best interest rates based on my down payment, my FICO score and how much I am borrowing.
Different lenders, different strokes. Based on your particular situation, set your own parameters, keep them the same when comparing rates. For example, you have 20% down payment, you want a fixed rate for 30 years, conventional loan, and your mid-FICO score is 720, you get 4.25% at ZERO POINT (Courtesy of Jessica McClure with CitiBank).
Or, it depends on how much money you want to borrow, if less than $417,000 your interest rate is 4.125% at ZERO POINT. Or if borrowing above $417,000 up to $625,500 , your interest rate is 4.375% at ZERO POINT. Courtesy of Ted Learakos with UAMC.
I bet you, if I got my 3rd lender to contribute his data, I will get different parameters, but what matters is what would be my interest rate at ZERO POINT…that is always the question to ask when shopping for the best rates.
By the way, these rates are only guaranteed for the day. Rates and points change daily. Some lenders say…hourly….wow !
Until my next blog…. I remain your ever faithful fighter for your best interest.