Everyday I coach consumers on which mortgage program should fit their needs and why.  Focusing and being responsible for the consumers best interest; has been the secret of my success.  The problem however is most new home buyers or homeowners have a hard time trusting mortgage loan officers or bankers.  Or finding someone who is upfront with pertinent disclosures and accurate with estimating closing costs
My recommendation is simple and this really narrows the playing field.  After obtaining Good Faith Estimates from several mortgage companies, ask each of them one question.  “If I choose your Good Faith Estimate illustrated mortgage recommendation; how much money will you or your company make.”  This question is usually never asked and in the mortgage industry and there are some who would feel very uncomfortable revealing their profit margin.  If answering this question becomes too much of a burden on the lender; you might ask them why or call another mortgage company.

But it’s this profit margin or Yield Spread Premium, and miscellaneous fees, that determines your interest rate.  Consumers should be aware.  It becomes much easier to compare one mortgage company to the next; than to figure out the science of APR.  Always shop several lenders and ask questions.  Make it fun; not a mystery.

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