Home Mortgage Loan Quote

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Getting a Home Mortgage Loan Quote Doesn't Mean You are Getting a Deal

Asking a lender for a home mortgage loan quote isn't the best tactic available to you. Just because they spout off the current interest rate off the top of their head, it doesn't mean that you're getting a good deal on your home mortgage loan. In fact, the lower the rate you are quoted, the more money they will expect up front, that is if the rate hasn't “expired” before you submitted your paperwork.

If lenders don't make money on the interest rate they quote you for your home mortgage loan, then they are going to make money elsewhere in closing costs or points you pay on the loan. Keep in mind that only asking for a home mortgage loan quote can be detrimental to the cost of your loan. Take a close look at where your money is going and shop for your loan based on those factors, not merely the quoted rate.

How much is fair for the broker to make on my home mortgage loan?

Well, it depends. Different lenders can make anywhere from a couple thousand to tens of thousands, depending on the amount of the loan, points and closing costs. A few thousand is usually a fair amount for them to make without gouging you. Remember than the loan agent not only has to pay himself, taxes, his processor, the appraiser, the escrow company, you get the idea. On the other hand, if you have bad credit, you will probably have to take a more expensive home mortgage loan.

What about the “bait and switch” quotes?

The basic rule of thumb is: if it sounds too good to be true, it probably is. The incredibly low rates that you hear advertised are probably non-existent or are only for people with credit equal to a saint's. If you hear a home loan mortgage quote without the lender knowing your specifics, disregard it. In order to get a good idea of the rates available, it's best to find lenders that don't charge fees until the loan closes and let them help you. You can speak with many before deciding on the lender right for you. On the other hand it's not worth the effort if you feel comfortable with the first lender that quotes you a rate for your home mortgage loan.