Have you ever been told that if it sounds too good to be true, it is? How many times have I found myself looking for the very cheapest item I can find when shopping, only to discover later that it broke or it didn’t work right because “you get what you pay for?” We are always caught in the middle of paying too much and feeling stupid or paying too little and not getting any value and wasting our money. This is never more true than in the mortgage industry.
I have had many clients that come to me after seeing an advertisement in the mail that they just couldn’t pass up. It just seemed like such a great deal. They felt that someone else could do something that I couldn’t. Well, they were right, I couldn’t because what they were being told wasn’t really available. Or it came with hidden items that were not clear and told to them upfront. I look in the paper at the rates posted and see what the competitors are posting and yes, you can get that great low rate that no one else is offering … for only two to three points. Points translate very simply to a percentage of your loan amount. So three points on a $300,000 loan is $9,000. That rate looked good, but how many years did it take for you to make up that cost?
A rate that comes with such a low payment that everyone could potentially afford an $800,000 home is just not realistic. If you think there is a catch, there is. If your loan officer tells you how great of a loan it is, but never gives you any other options or what the potential downside of the loan is, there is an issue. Trust, integrity and knowledge are what make a great loan officer. Experience in the loan industry is a must to navigate through all the different loans, rates, fees and programs. Financing a property is one of the biggest transactions that you do in your life. Shouldn’t you give it the same care and consideration you would in planning all your financial decisions? Most importantly, remember that the absolute lowest rate and terms on the wrong financial strategy or loan program for your life will prove to be far more costly than a competitive rate package on the right strategy, which correctly fits your financial goals and needs.
Loan Connectors is locally owned and operated in the Santa Clarita Valley and was honored by being profiled in the Broker/Agent Magazine and voted the 2005 Medium Business of the Year by the Santa Clarita Valley Chamber of Commerce.
For more details on home financing, please contact Linda Fleischmann at 661-295-0555 or Linda@loanconnectors.com.