Mortgage Myth Busters: Sure I could just QUOTE you a rate, but it probably won't be accurate

Sure I could just QUOTE you a rate, but it probably won't be accurate

Sure I can just QUOTE you a rate, but it probably won't be accurate. Will that be acceptable to you? Of course not!

This post is sparked from a recent email inquiry I received. The email asked for a 3.5% rate on a 30 year mortgage. Thats right... 3.5% mortgage product. After asking a few questions and providing feedback on today's mortgage rates, the shopper insisted that I just provide the mortgage fees to get a 4.25% (at least this time he is closer to reality). Still, I try to understand the goals and their financial situation, but they were quite insistent on me just giving them a quote at the rate they wanted without me knowing anything about their credit profile. My reply was "I apologize, but that is just now how I work. If you want an accurate quote, I'll need to understand more about your financial situation and goals."

If they are serious about moving forward, they will pick up the phone or email further details. Until then, we are just wasting each others time. You'll find someone that will just provide a rate, but expect to be irritated when they complete an application, run your credit, and suddenly the quote is higher due to a rate increase or the increase in points required. Then WE are the bad guys/gals because it appears we just 'switched' the rate and/or costs, when in actuality the original quote you received was never accurate.

Don't get me wrong, I'm not surprised when I get the question - "Whats your rate?".  Years ago, I use to be confused why somoeone would just ask such a generic question. But the fact of the matter is, when a homeowner (or homebuyer) is looking for a mortgage, they really are not sure what to ask. So, they ask the basic question to get the conversation going.

My typical response to this question is to ask questions of my own, so that I can understand their inquiry and provide an accurate quote:

  • How long do you plan on living in the home?
  • Are you looking for a 30 year term or something shorter?
  • What is your down payment (if purchase)?
  • Tell me about your credit profile (lates, previous collections, mortgage history, etc.)

These are just a few questions which will help a mortgage professional provide an accurate quote. Truth is, anyone can just provide a number off of the rate sheet. But, that may or may not be what you will qualify for.

My advice to "rate shoppers" is to be patient. Understand the mortgage product that is being quoted to you and find out what the qualifications are for that product. When calling one company after the next with the same question, "whats the rate", you'll find out that the products may all be different. One may quote a 30 year fixed rate, someone else may quote an adjustable rate mortgage, and a third person may quote a negative amortized loan (where the principal balance increases each month).  And I have not even mentioned those quotes that include points and those that do not include points.

After all... you are wanting an ACCURATE quote right? If not, then we wasting each others time. My adivce is to plan on spending a few minutes on the phone with a mortgage professional. Then and only then will you know 'What is the Rate'.

 

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Are you looking to purchase a Texas home?  Perhaps you love your Texas home but would be interested in refinancing your Texas mortgage to a lower interest rate?  

I'll help you get pre-approved for your Texas home loan and even suggest some very knowledgeable and professional Real Estate Agents in your area of choice.  If you are available to talk, I am available to listen.  Give me a call or visit my website for more details.

Do you want to know all of your mortgage options? Call me today and let's discuss them further.

Texas Home Loan Consultant

Always available for your Texas Mortgage and Home Loan needs!

John R Cannata    P#214.728.0449

NMLS # 322646

Texas Home Loan Expert

Frisco TX Mortgage

      

 

The views expressed on this site are mine alone and do not reflect the views of my employer.

Comment balloon 11 commentsJohn Cannata • January 23 2011 11:11AM

Comments

Good comments John.

I try to help out my lenders by providing an overview of my client when we come to the bank to get pre-qualified.

Shoppers in your business are like lookers in mine.

Necessary evil, but you never know what you'll end up with.

Thanks for the blog!

Posted by Art Hademan (Century 21 Real Estate Center) almost 10 years ago

We are an immediate gratification society! Patience and thoroughness will be the best assets for a new buyer. That and partnering up with a lender who has their best interests at heart. Great post!

Posted by Sylvie Stuart, Home Buying, Home Selling and Investment - Flagsta (Realty One Group Mountain Desert 928-600-2765) almost 10 years ago

Art - I think I have it more with random shoppers than from the clients that were sent from a Real Estate Agent. The clients from Agents tend to have a better understanding of what they are looking for, so Im thankful for agents like yourself.

Sylvie - That is so true that we want it now. A few years ago, we could get the same rate for individuals with a 620 FICO compared to 800. Those days are long gone, so its important that we understand a persons financial requirements and status.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) almost 10 years ago

Great post, John!  I used to have the same experience with potential buyers.  In the last year or so, however, no one asks about rate.  They are concerned about qualifying and cash needed to close!

Posted by Ed Gillespie (WealthWise Mortgage Planning, a Division of American Pacific Mortgage Corporation NMLS #1850) almost 10 years ago

John, you are right to gather all the information you need to provide accurate answers back to a client.

Posted by Gary Woltal, Assoc. Broker Realtor SFR Dallas Ft. Worth (Keller Williams Realty) almost 10 years ago

Ed - We certainly get a wide variety of questions. Focusing just on rate should be expected by anyone communicating by email only.

Gary - Im still surprised with how many people don't want to take the time to get an accurate quote. Spend a few minutes and ultimately be happy with the results you receive. Or at least know where you really stand.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) almost 10 years ago

Great information John. When some calls and asks whats my rate? I am always tempted to ask if when they walk onto a car lot, do they ask the dealer "How much is a car?"

Posted by Greg Miller, Florida Home Loans - Conventional,FHA,USDA,VA (Ruoff Home Mortgage ) almost 10 years ago

Patience goes a long way and it is a necessity when dealing in real estate; good to see you blogging again.

Posted by Teral McDowell (Referral Patners LLC) almost 10 years ago

Greg - That is classic. I'll have to remember that response.

Teral - I've been slacking over the past few months. Hoping to be around more often.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) almost 10 years ago

Yes I love those callers AND don't seem to understand particulars involved I love it when they start yelling about it !

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Posted by Lynn911.com ~ Dallas Real Estate Agent Top Team (Dallas Houses for Rent Dallas Apartment Rentals Lynn911.com ) about 9 years ago

Lynn - Those are the people that will ultimately end up with some horrible Mortgage Originator and be unhappy with their process.

Posted by John Cannata, Texas Home Mortgage - Purchase or Refinance (214-728-0449 http://TexasLoanGuy.com) about 9 years ago

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