The Not So Simple Task of Quoting Interest Rates

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Mortgage and Lending with NMLS #216987 IL Lic. #0006220

 

 

The Not So Simple Task of Quoting Interest Rates
 
 
 
 
    
 
Peel away the stress of mortgage financing.  Call Gene Mundt, Mortgage Lender today!     I liken Interest Rates to onions in more than a couple of ways.  Much like onions, Interest Rates have "layers".  In today's mortgage financing, a  Mortgage Lender  must weigh all the facts and peel away "layers" of information and data to find and reveal the answers to your  Interest Rate questions. 
 
     And right now with Interest Rates being at historic lows (but rising at the time of this writing), the more  you can peel away and sift through those layers of data and information, the better  Interest Rate you can get.  Interest Rates so low that they could make you cry,  just like an onion does.  Simply ask anyone that paid Interest Rates in the "teens" (or above) back in the mid-80's if the thought of receiving a 4% or lower  Interest Rate today doesn't about make them cry!  Tip: Be ready with a hankie ...
 
 
 
    Interest Rates are a big deal to everyone considering the purchase of a home or thinking about refinancing.  Rightfully so.  All want to know, "What actually goes into determining the final Interest Rate I will receive?"
 
 
    When speaking to my clients, most are aware that their credit and debt ... their  FICO scores ... play a big part in what Interest Rate they'll receive on their mortgage.  But many do not know that there are many more pieces of info and data that also contribute to the final outcome.  (Especially true, if a first-time home buyer.)
 
    What are some of those other factors that I  (as your  Mortgage Lender)  will use to determine your Interest Rate?  They can include:
 
 
 
  •  What type of property occupancy is involved?  Will it be your Primary Residence?  2nd Home?  Investment Property?
  •     What is the property type?  Is it a Single-Family Residence?  Attached?  Condominium?  PUD?  (Planned Unit Development)
  •   As a result of the above question:  How Many units are involved in the financing?  1-4?  More?
  •  What is the property's location?  State, County, City?
  •  What type of loan are you seeking?  FHAVA?  Conventional?  USDA-RD?  Etc ...
  •  Will you be paying  Discount Points?  (Fees paid at Closing, in order to obtain a lower interest rate)
  •  What type of Transaction do you seek?  Purchase?  Refinance?  (Rate/Term Refi? HARP  Refi (for  Underwater  Properties)?  Cash-Out (Loan above Balance), other) ?
  •  What amount of Reserves do you have?  (Months of Savings available for emergencies)
  •  What are your Credit Scores?  It is the MIDDLE Score that determines eligibility and loan approval.  If you are borrowing with a spouse/partner(s) ... once again, it is the lower (lowest) Middle Score of all involved, that determines eligibility.
  •  What is your Debt-to-Income ratio?  Meaning ratios of payments you make VS  Gross Monthly Income.
  •  Loan-to-ValueWhat kind of down payment are you making? 3.5%?  5%?  10%?  20%?   It CAN be reflected in the Interest Rate you receive. 
  •   If you are Refinancing, what is the amount of Equity in your home?  The Interest Rate you receive reflects the amount of Equity (expressed in terms known as Loan to Value, or LTV).
  •  Are there other factors contributing to your financial status?  If so, they are considered on a case-by-case basis.
 
 
     Whew!
 
Call Gene Mundt For a NO Obligation Mortgage Consultation today!     And, as though all of that isn't enough, let's add a bit of drama into this mix.  As the old saying goes, "timing is everything", so your Mortgage Lender now must strategically  "lock-in"  an  Interest Rate.   Like gas prices and yo-yos ... Interest Rates go up and down.  Because of this, "locking-in" and securing the most advantageous Interest Rate for a client becomes much like taking aim at a moving target.  Time to work with an expert, experienced marksman, for sure.
 
    I mean, just take a gander at all those determining factors I mention and list above.  Does it become more easy to understand WHY ... what seems on the surface to be a very simple question ... is in reality, NOT at all easy for a Mortgage Lender to answer? 
 
    The NOT so simple task of quoting Interest Rates.  If you are dreaming of buying a home in the future, get started now!  Allow yourself ample time to  thoroughly prepare for your mortgage financing.   Allow   yourself ... and your Mortgage Lender ... plenty of time for fact-finding and questions.  Truth is, it will take time to accomplish everything YOU need to do ... and all that needs to be done on your behalf. 

     It takes time and proper "timing" to seek and discover the most advantageous mortgage program and Interest Rates available to you.
 
     Please keep in mind too ... If YOU, or your clients, are in need of mortgage service and an Interest Rate quote ... it's absolutely the best time to work with an  experienced, knowledgeable mortgage lending professional.  A successful outcome for your transaction depends on it ... 
 
 
 
 
  
 
    * Hoping to buy or refinance a home in  Will County, Chicagoland, or elsewhere across the country?  Contact me  today!  I'll put my 35+ years of mortgage experience and expertise to work on YOUR behalf.
       I can be found at any of the following:
Cell/Text:    708.921.6331 
Email:  genemundt
     www.genemundt.com    
Skype:   630.219.1316 

Mobile:  m.genemundt.com

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Gene Mundt

Regional Manager - Mortgage Lender

American Portfolio Mortgage Corp.

                                                                    Personal NMLS #216987

NMLS # 175656

 

Gene Mundt, Mortgage Lender, a Lender with 36 years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL.  Gene Mundt, Mortgage Lender can be contacted at: 

815.524.2280 or via his email: gmundt@goapmc.com.

Contact Gene Mundt, Mortgage Lender soon!

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Sharon Alters 08/21/2012 08:57 PM
  2. Gabe Sanders 08/27/2012 04:10 AM
Topic:
Lending / Financial
Location:
Illinois Will County New Lenox
Groups:
WillCounty
Mortgages
1st Time Buyers
Chicago Area Real Estate BUZZ!
BananaTude
Tags:
refinancing a loan
home buyers
mortgage financing
financing
home buying
mortgage programs
interest rates
quoting interest rates

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Ambassador
766,254
Brenda Mullen
RE/MAX Access - Schertz, TX
Your San Antonio TX Real Estate Agent!!

Wow..terrific overview on what goes into figuring out the intest rate.  There are a ton of factors..but even so, now is the time to take advantage of the low interest rates, because even if you have to pay a slightly higher one than some, it's still going to be a whole lot better than it was about 6 or 7 years ago!

Aug 21, 2012 05:58 PM #7
Rainmaker
730,556
Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com
NMLS #216987 - New Lenox, IL
708.921.6331 - 37 yrs experience

Louise:  Thank you ... great to hear that from you!  And yes .. lots and lots of questions these days, aren't there?  We don't live a dull life ...

Reuben:  Thanks for the thumbs-up.  Appreciate the subscription also.  Will be checking your business out ...

Jason:  Glad you liked the onion thing.  And just got done reading about the new credit scoring system that was introduced recently.  We'll see if it gains acceptance ...

Chris and Dick:  Hope you're getting your fair share of that cash market!  What a luxury ...

Greg:  Thanks ... I like hearing I hit a round-tripper ...

Joan:  With financing being more challenging, now more than ever, it's important to work with experienced professionals ...

Brenda:  Definitely an important point ... the sooner someone gets involved with their financing .. and viewing homes ... the better.  Interest Rates (as of late) have been rising and it sounds like housing prices are following suit.  Acting now would be wise ... Good to see you, Brenda!

Gene

Aug 21, 2012 07:18 PM #8
Rainmaker
349,090
Sonja Patterson
RE/MAX Realty Center - Cypress, TX
Texas Monthly 5-Star Realtor Recipient for the Hou

Great explanation Gene!  Love the onion analogy--hopefully no more tears for buyers!

Aug 21, 2012 07:18 PM #9
Rainmaker
730,556
Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com
NMLS #216987 - New Lenox, IL
708.921.6331 - 37 yrs experience

Sonja:  Totally agree ... no tears necessary!

Gene

Aug 21, 2012 07:21 PM #10
Ambassador
508,819
Jason Sardi
Auto & Home & Life Insurance throughout North Carolina - Charlotte, NC
Your Agent for Life

Personally, I'm glad they don't lend or risk alert on FICO alone.  That can be deceptive.  While I can sit here and long for the days of manual underwriting across the board, that probably won't happen.  Give me work history, income stability, a paper trail of paying bills on time and reserves (and an equity position) ... I'll take a steak with my onions.

Aug 21, 2012 08:11 PM #11
Rainmaker
981,195
Sharon Alters
Coldwell Banker Vanguard Realty - Fleming Island, FL
Your Fleming Island Relocation Agents.

Gene, this is the perfect post to hand to or email to someone who wants to know what the rate is today! Consumers think it's simple, when it's actually very complex, as you outline.

Thanks re-blogging!

Sharon

Aug 21, 2012 08:55 PM #12
Rainmaker
437,582
Pete X with X Group Real Estate Advocates, Huntington Beach, CA 714.459.2017 OCLister.com
Investments to Luxury - Huntington Beach, CA
Outstanding Agent Referrals-Nationwide

Gene,

Great one you describe what you do.

Hope you continue to make people cry.

Aug 21, 2012 09:28 PM #13
Rainer
132,361
Laura Murray
Weichert - Silver Spring, MD
Search Montgomery Co., MD for homes www.MDRealEstateOnline.com

How true, this is why it is important as a Realtor to have a relationship with a mortgage lender, so we know when clients are getting good "help" vs BS.

Aug 21, 2012 11:08 PM #14
Rainmaker
1,152,616
Ginny Gorman
Phillips Post Road Realty ~ 401-529-7849~ RI Waterfront Real Estate - North Kingstown, RI
Homes for Sale in North Kingstown RI and beyond

Gene, that is why you are consummate mortgage professional...you deliver well and you explain easily the gobbleygook of mortgage lingo & facts!

Aug 22, 2012 04:21 AM #15
Rainmaker
270,447
Rob Spinosa
RPM Mortgage, Marin County, CA - Mill Valley, CA
Marin Mortgage Broker

Great, informative post, Gene. 

Aug 22, 2012 05:55 AM #16
Ambassador
1,011,026
Harry F. D'Elia
Precision Real Estate Inc. - Phoenix, AZ
Investor , Mentor, CSSN, Radio Coach, REOs, ABR

We are noticing interest rates going up over the last couple of weeks. Many people are focused on interest rate and monthly payment.

 

Aug 22, 2012 06:25 AM #17
Rainer
142,317
Linda Piper
Planatek Financial, Inc. - Westlake Village, CA

Really great explanation of the factors that we need to analyze in order to determine a correct rate!  Thank you Gene.

Aug 22, 2012 06:30 AM #18
Rainer
27,553
Alan Bercovitz
Guaranteed Mortgage Quote, LLC - Exeter, RI

The standard mortgage industry application, the 1003, only asks a small fraction of the information a mortgage professional needs to know before quoting an interest rate.  What would you say Gene, maybe 20%?  The other 80% the mortgage professional has to (tries to) carry around in their head.  Takes a lot of experience to drag that 80% around with you every day.

Aug 22, 2012 06:37 AM #19
Rainmaker
1,371,643
Richie Alan Naggar Author PEARLS SERIES of books
People first then business! Ran Right Realty Riverside, Ca - Riverside, CA
on LIFE and LOVE plus Real Estate too!

I have worked with enough lenders to know that once we get past their qualifications, they will give me their best rate

Aug 22, 2012 06:55 AM #20
Rainmaker
730,556
Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com
NMLS #216987 - New Lenox, IL
708.921.6331 - 37 yrs experience

Jason:  Manual underwriting?  Most Lenders these days would wonder what the heck you were talking about!  I started at a Savings and Loan where the loan approval committee was the Board of Directors for the S&L.  Now THAT'S real insight into just how long I've been at the business of mortgages.  There were strong pros ... and cons for that system too.  The speed of technology is wonderful ... but do wish we could have retained some of the common sense and humanity of the old loan committee too.  Guess asking for that steak is asking too much?

Sharon:  Thank you!  Hope the info proves useful to all that read it ...

Pete:  Although we're seeing some roller coaster in our rates right now, I think they will remain very advantageous at least past election.  After that, who knows??  If your clients want to be sure to get a great rate, sooner than later would be best ...

Laura:  I think a strong, trusting, and reliable relationship between agent and lender is important, no matter the topic.  The better the professional relationship is, the more the client can rely on a successful outcome to their transaction.  Agent and Lender working together in tandem can solve almost any crisis ...

Ginny:  You chose the perfect word for it all ... goobledygook!  Explains it perfectly ...

Rob:  Thanks!  Who knows better of what I speak than another mortgage professional??  Thanks for dropping a note ...

Harry:  Without a doubt, interest rates are important.  But a client shouldn't focus so intently on them that they overlook the importance of other facets of their mortgage.  Exactly what I try to prevent them from doing.  They need to see the entire picture ...

Linda:  Thank you much for the thumbs-up!  What we do on a daily basis as Lenders is hard to explain ... or put to paper. 

Alan:  You're absolutely right.  Although they try to streamline the info into a form and checklist ... the individual and specific nature of current mortgage lending almost deems that near impossible.  Never dull though, is it??

Richie:  I'm glad that you have found local lenders you can rely on and trust for solid info and action. But if you ever need a 2nd opinion or your client is open to a more technologically-based mortgage service ... you know where to find me!!  Would LOVE to do business with my friend, Richie Naggar!

Gene

Aug 22, 2012 07:34 AM #21
Rainmaker
1,371,643
Richie Alan Naggar Author PEARLS SERIES of books
People first then business! Ran Right Realty Riverside, Ca - Riverside, CA
on LIFE and LOVE plus Real Estate too!

Gene...I am way ahead of you..I am looking for the opportunity to come to you....Let it be so please for both of us

Aug 22, 2012 10:38 AM #22
Rainmaker
730,556
Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com
NMLS #216987 - New Lenox, IL
708.921.6331 - 37 yrs experience

Look forward to that call, Richie!  I appreciate ... greatly appreciate ... the opportunity ...

Gene

Aug 22, 2012 10:52 AM #23
Rainmaker
2,016,461
Gabe Sanders
the BlueWater Realty team specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Excellent information.

Aug 23, 2012 05:08 AM #24
Rainmaker
1,599,793
Joan Cox
Metro Brokers - House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Gene, it is amazing you can call 3 different lenders for the same loan, and get 3 different rates.    

Aug 23, 2012 06:34 AM #25
Rainmaker
730,556
Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com
NMLS #216987 - New Lenox, IL
708.921.6331 - 37 yrs experience

Thanks, Gabe!  Appreciate it ...

Joan:  Much like a retailer, banks and lenders offer different mortgage programs and price their products differently.  Explains the difference in rates you will receive ... 

Gene

Aug 24, 2012 03:11 PM #26
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Rainmaker
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Gene Mundt, Chicago-area Mortgage Lender - www.genemundt.com

708.921.6331 - 37 yrs experience
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