A Quick Review of Home Loans 101

Or, How I Learned To Shop Around For A Loan And Saved Thousands of Dollars

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Over the past several weeks, our articles have focused on many of the “consumer education” resources that are available to borrowers – both through the Consumer Financial Protection Bureau (CFPB) website and our own KnowBeforeYouOweNevada.com website.

As the CFPB prepares to roll out one of the most important recent changes to the mortgage loan process soon (TILA-RESPA on October 3, 2015), it seemed like a good time to review what we believe are the positive effects of new legislation and the role of the CFPB in the mortgage industry. Ready for a little Q&A? Great – let’s get started!

1. “Is the Dodd-Frank Act really a good thing for consumers?”

Definitely good. As we explained in greater detail in a previous article, one positive result for consumers is that it places a ‘cap’ on how much a Mortgage Broker can earn on your loan. It’s a fee that cannot be inflated – it is paid by the lender directly to the Mortgage Broker – and most importantly – it must be disclosed to the borrower. Basically, it places the control over the cost of the loan into the consumer’s hands (A good thing, right?). It’s important to note, however, that these same restrictions don’t apply to banks or mortgage bankers , who have no limits on the amount they can earn from your loan. So beware of those ‘invisible fees’ that they don’t have to tell you about – but end up costing you more in the long run.

2. “One mortgage lender is the same as another, right?”

Wrong! We mentioned above just one of the differences between types of lenders (banks, mortgage bankers, and mortgage brokers), and in a recent article we clarified those differences in detail. The short version is that a mortgage broker offers better value to consumers because:

• You only fill out one loan application – and they can shop numerous lenders on your behalf to find the lower rate and best loan program.

• There’s a limit to how much a mortgage broker can earn – not so with bank or mortgage bankers.

• Mortgage brokers are typically small, local companies with low operating overhead. That means less cost to you.

3. “Does every lender have to disclose how much they’re earning on my loan?”

Nope. Once again, the rules are different for mortgage brokers vs. banks and mortgage bankers. (Are you noticing a trend here?) Just like they say in the movies, “Follow the money.” One way to discover if a lender has ‘invisible charges’ in your loan is to compare the Loan Estimate sheet. (The CFPB has many helpful resources for consumers, including a form to help you compare your loan estimates in an apples-to-apples format, here.) Pay particular attention to the interest rate, the Loan Origination Fee, the Document Prep Fee, and the Document Fee. It can mean a savings to the consumer of literally thousands of dollars. (Not all lenders are the same!)

4. “How can I tell if a Builder or Seller incentive is a good deal?”

Compare the numbers. Often, those “credits towards closing costs” offers come with strings attached, as we explained in a recent post. And those strings can end up costing you more than you expect. You “have” to use their lender or title company to get that credit? Then you’re probably going to end up paying for it in higher interest rates or unnecessary fees. The best way to protect yourself financially is to contact more than one mortgage lender – then run the numbers.

5. “What should I do if my Realtor is encouraging me to contact only their lender?”

At the very least, question their allegiance. By law, it’s supposed to be to you – their client. But as we explain in our recent video about Marketing Services Agreements (MSAs), there’s usually a reason that a Real Estate Broker will strongly encourage you to use their lender – and it can often end up being at your expense. While even the CFPB is encouraging mortgage lenders to end the practice of MSAs, they’re still prevalent in the industry. Yet one more reason every consumer should shop with more than one lender to get the best mortgage.

To learn more about any of these topics, we encourage you to visit KnowBeforeYouOweNevada.com to find out which questions you should be asking your real estate professional and your mortgage lender. If they can’t compare – dollar-for-dollar – to Premier Mortgage Lending’s “No Fee Mortgage,” then we should talk about how we can save you money. Oodles of it.

Premier Mortgage Lending, NMLS #393282, is located at 701 N. Green Valley Pkwy., Suite 125, Henderson, 89074. The full-service lender is a member of the Las Vegas and Boulder City Chamber of Commerce, Better Business Bureau and Southern Nevada Home Builders Association, as well as an affiliate member of the Greater Las Vegas Association of Realtors.

OWNING A HOME AGAIN REALLY IS AN OPTION – WITH THE RIGHT LENDER

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If you’ve owned a home before, you know how it feels when a dream becomes a reality. You’ve felt the pride of staking a claim on your own land, the joy and satisfaction that comes from making your home environment personal and unique to your family’s needs.

But if you lost that home in a foreclosure or a short sale – as so many thousands were forced to do during the recent recession – you also know what it’s like to have your dream come crashing down around you.

As Rick Piette, owner of Premier Mortgage Lending states, “There’s no doubt about it – losing a home that way is devastating. And it’s not just a financial matter – it’s emotionally difficult for you, your family, and perhaps especially on your self-esteem. Being able to provide the basics for our family is built into our DNA – which makes such a loss a very difficult transition. ”

However, we’d like to remind you that this is a good time to remember that old adage: “It’s better to have loved and lost, than never to have loved at all.” Because we’ll let you in on a little secret . . . that theory applies to many things in life. It’s especially true when it comes to owning a home again. Because just as love will find a way to re-enter your life — once you’ve experienced the pride of owning a home, you’ll find that with the right help, you can get back there again, too – and earlier than you may have thought.

“At Premier Mortgage Lending, we wanted to take an active part in getting Las Vegas families back into a home of their own,” reveals Piette. “We’re part of this community, too – and rather than stand by and idly watch as the housing crisis hit our family, friends and neighbors so hard – we decided to seek solutions instead. The kind that could help people recover financially and experience the pride of becoming a homeowner once more – sooner rather than later.

“For the last several years, that’s been the sole purpose of Another Chance Nevada. With our unique private lending division, we’ve made it possible for hundreds of people to obtain a mortgage loan as early as one day following a short sale or foreclosure.

“Because private financing is free of the mandatory waiting periods that accompany government-backed loans following a foreclosure or short sale,” he continues, “we’ve been able to assist buyers in obtaining that coveted ‘Good news! Your loan has been approved!’ phone call a lot faster. And even while the rates and costs may be slightly higher than an FHA or VA loan – the savings still add up over time when compared to the high costs, uncertainties, and restrictions that go along with rented properties.”

Studies have shown that over half of the people who want to buy a home are too afraid to ask if they qualify, simply due to the hardships they suffered during the recession. But with the passage of time and an economy on the upswing – this is precisely the right time for you to ask that question . . . of the right lender. Let Premier Mortgage Lending help you find a way to give you back that American Dream. Call today for a personal consultation – or even apply online.

Premier Mortgage Lending, NMLS #393282, is located at 701 N. Green Valley Pkwy., Suite 125, Henderson, 89074. The full-service lender is a member of the Las Vegas and Boulder City Chamber of Commerce, Better Business Bureau and Southern Nevada Home Builders Association, as well as an affiliate member of the Greater Las Vegas Association of Realtors.

THEY FOUND THE RIGHT LENDER WITH PREMIER MORTGAGE

Wolff Testimonial - Premier MortgageCouple Shopped, Compared, and Made the Right Choice

Like many families, Matthias and Deborah Wolff knew at some point in the future they were going to wish to refinance their home mortgage to take advantage of lower interest rates and better terms. As long-time homeowners, they also knew that making the right choice of which lender to work with could make a huge difference in how smoothly the whole process could go – or not. To put it more accurately, on at least one previous occasion, they had discovered the hard way that ‘choosing wisely’ for this particular service is more important than they realized.

But Deborah and Matthias are nothing if not thorough. Their past experience had given them a clear sense of the traits they planned to seek out in the next lender they worked with – so they waited, and watched, and learned. As they did, the practices of one particular mortgage lender caught their attention. So they took the next smart step: to wait, watch, and learn more.

As Deborah Wolff describes it, “Through the years, we would run across articles written about Premier Mortgage Lending here in Las Vegas and we would clip them out of the Review Journal newspaper and save them. We’re from before computers,” she added with a laugh. “But what caught our attention about these stories is they were so informative and knowledgeable, and the owner, Rick Piette, seemed like a genuinely good human being.”

Husband Matthias Wolff agrees, adding “We had a good feeling about Premier from the beginning, because the articles we read were very helpful, providing a lot of good information for borrowers. Every time we saw a new one, it sounded so thorough. It was as if they had nothing to hide – they laid everything out very clearly.”

Still, when the time came to start their refinance process, the Wolffs were smart enough to shop around – one thing that Premier Mortgage Lending owner, Rick Piette, encourages all of his customers to do.

Piette explains why: “Even today – with all the changes in financial regulations, and the information and protections being provided to the consumer by the Dodd-Frank Act – borrowers aren’t always aware they have choices when it comes to their mortgage loan. Many believe they must use the lender recommended by their homebuilder or Realtor, or that a pre-qualification letter commits them to that particular lender. Not only is that not true, but by failing to shop around for a mortgage loan like any other product – borrowers often end up paying far money than they need to, often thousands of dollars more. All lenders are not the same – that’s why we encourage customers to shop and compare rates, costs, and terms”

That’s good advice Deborah agrees, as she goes on to share more details of their experience: “We started out with Premier to see for ourselves if they would be the right fit for us. But we also checked out another lender, too. We met with him, provided information as he asked, but then he didn’t get back with us when he said he would. And when he finally did, he didn’t keep his promises. There was no follow-through, no honesty. So it didn’t take us long to head back to Premier.”

Working with the Wolffs as their Premier Mortgage Lending loan officer was Dianna Herra – and it was clear from the first meeting that theirs was a great match.

“Often on a first visit with a client, I explain the different loan options and give buyers a list of documents they need to pull together to submit with their application,” reveals Dianna. “But on the day I met with the Wolffs, they had everything with them, all organized and in a neat binder – every item that we would need to get their loan started . It was surprising – and very refreshing, too,” she recalls with a smile. “They were so delightfully open and honest and they both recognized that’s how we work at Premier, too. I knew right away that we were all on the same page.”

Once they started the ball rolling, the entire loan process was completed within a month. “That was from start to finish, and even included the time it took to wire the money at the end,” added Matthias. “We don’t have one complaint about our experience with Premier. The entire office was wonderful – kind, knowledgeable, and extremely helpful. They really cared about getting it done on-time, and everything they told us happened exactly as they said it would – or sooner.”

His wife, Deborah, was quick to add “Dianna and her assistant, Cathy Zora, could not have been better. They kept us informed, processed our loan with no complications, and as far as we’re concerned – they are pure honesty and were a real delight to work with. We really appreciated the sense of ‘morality’ in their office. That’s important to us. It was obvious to us that Rick chooses to work with people who have the same sense of that morality that he does. We felt he should know how good a business he is running, especially in this day and age. That’s why we offered to share our experience.”

When you spend a lifetime trying to do the right thing, it becomes habit. When you apply that same philosophy to your business and the way you treat your customers – people notice. More and more consumers are discovering that every day at Premier Mortgage Lending – where the talk is straight, the service is personal, and the loan programs are designed to provide customers with their best, most affordable options. It’s not a gimmick – it’s just what they do

Premier Mortgage Lending, NMLS #393282, is located at 701 N. Green Valley Pkwy., Suite 125, Henderson, 89074. The full-service lender is a member of the Las Vegas and Boulder City Chamber of Commerce, Better Business Bureau and Southern Nevada Home Builders Association, as well as an affiliate member of the Greater Las Vegas Association of Realtors.