| A Homebuyers Service From CLHLLC |
CLOSING COSTcontinued
HOW ONES IN LENDING MAKE MONEY continued
No Cost loan. Many 'mortgage agents' offer loans at no points. You will find the interest rate on these loans may be slightly higher than on a loan where you pay one point. Also you ought to ask if the lender is waiving other cost beyond the normal one point cost.
I will bet not. More likeky you are dealing with a yield spread premium. Many of the persons providing the purchase money for your loan will fold the fees into the interest and then give a 'rebate' to your loan company. This allows your loan company to advertise a 'no cost' loan or perhaps a 'one fee' loan. Your loan company could also pay the money provider some money to lower the interest. This would be similar to discount points.
The companies claiming the lowest rates may have the highest fees. And the companies claiming the lowest fees, may have the highest rates. You may think about this. Pay closing costs up front instead of wrapping them into the mortgage. Otherwise you will pay interest on that few thousand dollars for the life of the loan. An exception might be if you intend to keep the loan for only a short time. On the opposite side, pay the higher rate rather than discount points, unless you intend to keep the loan for a very long time.
GIVE CHRIS A CALL – LET’S DISCUSS CLOSING COST,
AND START YOU ON THE ROAD TO HOME OWNERSHIP
YOU CAN'T MISS WITH CHRIS Call him today! OK?
