Roger Schlesinger

Before you start typing and formulating your thoughts and curses please understand one important fact: rates are made up of anywhere from seven to ten factors and posted rates,in the overwhelming majority, will not apply to you.

If that isn't enough to make you wonder , then how about the fact that rates can change 3 or 4 times in a given volatile day? Now add in the notion that one lender doesn't have the best rates for every type of loan, so you may be looking at a lender's rate which is terrific for the loan they are quoting but won't be very competitive for your type of loan. What is a person to do?

Start with trying to find out something about the broker or lender. One can go onto these companies' web sites and see what they have to say. If it seems "less than moving" or touting loans you are not interested in, or shouldn't be interested in , as in the "option arm",then move on.

What are the factors that make up a loan. Let me list them and perhaps you will understand what I was talking about in the opening paragraph.

1. Size of loan - Conforming limits, jumbo limits or super jumbo limits

2. Purpose of loan - purchase, rate and term refinance or cash out refinance

3. Type of property - owner occupied, second home or investor: 1 to 4 units

4. Qualifying for the loan - full documentation, stated income or no documentation

5. Credit profile & score - over 700, 620-700, 545 to 620 or over 500, under 545

6. Impounds (taxes & insurance) or no impounds

7. Loan to Value

8. Type of loan - fixed or variable

9. Fully amortized - 15 year, 20 year, 30 year, 40 year or 50 year


10. Interest Only - length of the fixed part of an arm, 10 years or 15 year

Each one of these are needed to make up the eventual loan program and rate. When you check rates can you imagine how many one would have to post to fit every situation?

That's the problem!

Back to the adage "what's a person to do" when trying to get a good rate for themselves.

Start by arming yourself with knowledge. Look at every one of the ten points above and go to work on yourself. Not one of the factors is difficult for you to understand and apply to your situation. If you approach a lender with all the information then the lender can immediately go to the right source for the best programs and rates for you.

Roger Schlesinger

Roger Schlesinger's Mortgage Minute is heard on hundreds of radio stations and daily on the Hugh Hewitt radio show and Michael Medved shows. Roger interacts with his hosts and explores the complicated financial markets in order to enlighten his listeners and direct them along their own unique road to financial freedom.