Running through my daily news this morning caused me to finally get agitated enough to write a blog post. I've referenced an article where the author claims over 90% of the public can't get a sub 4% mortgage. I've not done any studies, but anecdotally it's entirely false. Every one of my buyers this year has been within .25% of prime regardless of their credit score or down payment, and most have been at prime!
The author quotes a study where Lending Tree found that the average rate given by its network of lenders was 4.32%. I could see this being very possible. Lending Tree pays a fortune on advertising; it charges its member lenders a fortune in return. Three years ago I had a close relationship with a mortgage company that got leads from Lending Tree and their fee to lending tree was $35,000 per month.
With that kind of advertising overhead, you've either got to do a ton of mortgages, or you need to offset some of the difference by raising your rates. After all, when banks compete, you win! And if all the banks have the same high fees, then their rates are likely to be close as well. The average consumer doesn't do any research on their own; if a commercial is well produced then its message is taken as gospel by the consumer and viola, no need to really compete.
I have found and been using an absolutely phenomenal lender over the last two years. She won my business by being the first lender I'd ever seen who actually cared enough about my buyer to contact me on occasion and see how things were going. She was also the first to get fighting mad when my buyer (our mutual client) was starting to get hosed by another bank on a short sale. She was alongside me calling the bank fighting for our client.
After showing that level of service and commitment to my buyer’s best interest, she now gets recommended every time. I have other lenders that I can use from time to time, but none compare to her tenacity and ability to get things done. When I see all the news or commentators talking about how people can't get mortgages it makes me so angry. It's simply not true! If you have a credit score at 640 and up, people are lending without headaches. If you are 600-639, there are still ways to get good financing; it just takes a few extra steps.
Quit listening to the news and commentary. It isn't as bad as they say. There are people getting absolute steals on real estate right now because the number of buyers is so low. Great prices, great rates and great selection make this a GREAT MARKET for buyers! Go get pre-approved and start house hunting. If you'd like the name and number of my great lender contact me anytime, I'm happy to give you her name & number.