What Interest Rate Can I Get?

What are your rates?

Part 1 of 2
By far, this question often comes up within 2 minutes of talking to someone for the very first time. It is the most asked question I get from my clients. Most people assume that everyone gets the same mortgage rate which is a common misunderstanding.

After reading this post, I am sure you will have a better understanding of why each rate quote is a custom rate quote. You should also know that there is much more to making a decision on your mortgage than just finding the lowest rate available. Getting the lowest rate isn't the best if you pay fees that are thousands of dollars higher than someone else who received a rate close to yours.

Why is it important to go through all of this work before quoting a rate?

To be honest, as The Upfront Mortgage Broker I don’t want you to be telling your family & friends that the rate you ended up getting on your loan was higher than you were told in the beginning. It won’t happen if the questions are asked upfront.

What Goes Into a Mortgage Rate?

Every lender, be it a banker, broker, or private equity, have multiple questions that require answers before a rate quote can be offered. It is similar to making a loaf of bread, if you mix on more of one ingredient than another, the bread will taste differently. Here’s a quick list of some questions that MUST be answered before I can begin to properly serve you:

Where is the property located? (City, State, Etc.)

How will this property be occupied? (Owner occupied, second home or investment property)

Is this a purchase or refinance?

What is the condition of the property?

What type of property is it? (Single family home, condo, town home, high rise, duplex, triplex, etc)

How much land is the property being sold with? (if it’s a huge acreage, it won’t be a conventional loan)

If it’s a condo - is this condo project approved? (I don’t expect clients to know, but we have to find out!)

How much is the property worth? (Sales price AND appraised value)

How much money will you be putting down? (…is it your own? Is it gift funds? Is it seller down-payment assistance?

How many properties do you already own? How many of those are financed? By whom?

How long of an amortization would you like on the loan? (10 years, 15 years, 20 years, 30 years, 40 years, 45 years?)

What terms would you like to have? (fixed or adjustable?)

What type of loan are you looking for? (fully amortizing, interest only or negative amortization)

What is your credit score? (We need a full credit report. I won’t issue a pre-approval unless I have pulled your credit report. I can’t close a loan for you using another companies credit report.)

Can you document your income? (and make the numbers work doing so!)

Can you document your assets? (some programs require certain reserves, etc.)

In addition to the above questions, the questions listed below are also helpful:
* What are taxes on this property?
* What is insurance on this property?
* Is this property located in a flood zone?
* What would you like the loan amount to be?
* How long of a note would you like? (for balloons… 7 year, 10 year, etc)
* If you’re considering adjustable, what length would you like to have it fixed? (6 months - 10 years)
* If you’re considering adjustable, which index would you like to have your ARM tied to?
* How quickly are you looking to close on this loan? (lock period and picking the right lender..especially in today’s market)
* Do you have a preference on which bank services your loan? (some clients like some banks and hate others
* What’s your debt to income ratio? (We will calculate this for you when we have your income and expenses fully documented).
* Do you plan to escrow for taxes and insurance?
* Will you be getting private mortgage insurance (PMI)?
* If you’ll need PMI - which type will you get?
* Will you be getting a second mortgage or Home Equity Line of Credit (HELOC) with this new first mortgage

Keep in mind that most lenders will ask you 3-5 questions and then spit out a rate that they think you want to hear. This isn't the case with myself or other registered upfront mortgage brokers. If you are looking at a property outside the state of Florida, please visit the Upfront Mortgage Brokers website for a broker that can help you.

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If you have any questions about this post or need to talk about a specific situation, I encourage you to contact me today.

Respectfully,
Joe Bartolotta
The Florida Upfront Mortgage Broker
No Charge Mortgage Consultations
Residential, Commercial & Reverse Mortgages
Direct 407.340.0220
Joe (at) the upfront mortgage broker (dot) com