Rushing Into a Mortgage Can Be Costly

thinkaboutit | Jan 18, 2013 04:04 PM ET Unless you are going to live in the house for 30 years, I do not see the benefit to paying points.

gruntspeak | Jan 18, 2013 04:46 PM ET The old GFE was much simpler. Better to go back to that and just continue to enforce the variance requirements. And if it ain`t locked, you don`t have the rate, no matter what anyone says. And as always, if it sounds to good to be true, it probably is.

Quest4Dollars | Jan 18, 2013 05:27 PM ET Spend time hiring a good real estate agent and a great mortgage professional. Also, not all mortgage representatives are created equal. There are good and bad employees at most every company/bank out there. Do some research and find someone who is good and comes highly recommended. Most real estate agents will be able to recommend a good mortgage person. Even if it`s for a refi they`ll be glad to give you a name. Do some due diligence! Take responsibility. Read documents. Ask questions. Get advice. Most importantly, don`t close the deal unless you are comfortable with the house, loan and paperwork.

mapollo | Jan 18, 2013 06:33 PM ET Just like cars houses deteriorate, most houses will loose 2% a year if improvements are not made. On a $200,000 house thats $4,000 a year or $20,000 over 5 years. Few people keep tract of how much money they spend keeping their home up. Of course if the house is a dump if will deteriorate at a slower rate. A new house does not look new after 5 years. Add 3.5% loan fees, other closing costs, moving expenses, 6% commission when you sell, you will still lose $40,000 on a $200,000 house without inflation. A home is still a good investment. After 30 years the home should be free and clear. With the inflation that is comming in five years real estate is a better bet than the stock market. I own timberland. It`s hard not to make 10% a year on timberland. Even if timber

Harryjh | Jan 18, 2013 06:34 PM ET Not all brokers are out to violate the GFE rules. Most loan processing programs (Point) have a "Fee WorkSheet" associated with the GFE. All "Non-Recurring" and "Recurring" cost are detailed in the GFE`s, Fee WorkSheet. Consummers should alway request the "Fee WorkSheet", at time of loan application, that is associated with the lender`s GFE. APRs are a dead give away for a lender charging a rate with hidden cost. A no point loan will have a max difference of .125% above the stated interest rate. Usually APR differences are associated with loan amount. I`ve been in the mortgage business since 1972, and there has always been bad guys around this industry. Gov`t. regulations never help, when they confuse the general public.

rossnh | Jan 19, 2013 07:56 PM ET There is some good information in this article and some that is way off base. Some is just opinion but based on 23 years in the mortgage business I would say it is largely off base. One glaring mistake is when the author says "A point reduces the mortgage rate by a quarter percentage point, but it costs a half of a percent of the loan value." First of all a point is 1% of the loan amount, NOT 1/2 of a recent and secondly it can reduce the rate 1/8, 1/4 or 3/8 and sometimes zero. Mortgages can be complicated and most professional I know try to make things clear but we are not always sucessful. I read a lot of articles that have really bad information in them. This one is not awful but not great either.

giofls | Jan 20, 2013 01:14 PM ET Let me get this right. These folks are about to commit to a $1,200 per month payment for the next 30 years ($250K at 4%) and they are not worried about the details? Oh sure, raise my interest rate 1/2%; I just want that apartment. Do they know that extra 1/2% will cost them $25K over the 30-year loan? Are these the same people who agree to pay for $25K a car and end up at $28K because the dealer "forget to count" something in the price? The bank, the realtor, the mortgage broker and the car dealer are not your friends. They are out to make money, and if you are a sucker they will take advantage of you. If you get that abused on the big stuff, you`re getting killed on the small stuff.

Goldman99 | Jan 22, 2013 10:41 AM ET Are you telling me that bankers are dishonest SOBs who make billions taking advantage of people? Is hard for me to believe that, they are doing God`s work, right?

Jay070 | Jan 23, 2013 08:39 AM ET "americannovice | Jan 18, 2013 09:46 PM ET It`s the American way. Rip each other off." Best post so far. Basically we let the banking class rip us off every which way. Closing costs are a sham. Why should it cost $3000 to $9000 to punch a few numbers into a computer? People pay it because they have to and they think banks are loaning money they actually have and are entitled to interest and fees. If people knew the ugly truth, there might be a revolution.

Louson | Jan 23, 2013 08:55 AM ET I`ve been trying to trade the Forex for years now and never could make money. I found a website called Traders Superstore which is having a special right now purchased all their videos got some help from the support and now I`m doing my own trading and making money. I will never go back to trading the Forex ever again!

asoduk | Jan 23, 2013 11:57 AM ET I bought my house in 2010 through a smaller broker and while he seemed to be very up front with everything and helpful, it remained confusing about all of the fees. I am now closing on a refi this week though a big bank and it has been a really painless process. They have been up front and have answered all of my questions with minimal cost in fees. I still think there are too many people making money as middle men in real estate. Title insurance, to me, has been the one I am most against. The mortgage brokers are just as bad. You have to realize that you`re paying extra when you arrive at their fancy office and see their new BMW outside while they are making you feel like you`re getting the best deal ever on the loan with such minimal costs.






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Rushing Into a Mortgage Can Be Costly

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