Mortgage - How Do I Shop Around?

Question

My 2 year fixed mortgage deal is coming to an end soon and with all the press about increased payments I wanted to do some homework and get some figures worked out. I am still in the same house and just want to put another 2 year fixed o rtracker, whatever, onto my current property.

However, when I go to search on moneysupermarket and other places I am asked whether I am a first time buyer, remortgagor, buying to let etc etc and I don't seem to fit into any category!

Can you help, I think I am missing something here.

Answer 1

Youl will probably get a better deal using a local lender rather than an internet lender.   Internet lenders have to tack on all sorts of fees for the long distance transaction that local lenders don't have.  Closing costs can be higher.  There is alot of bait and switch that goes on, they get you sold on some great program with great rates and low closing cost fees, then when your documents come, that program was no longer available (they don't tell you that, you find out when you question it), so you get the higher cost program.   Also, local lenders work off of referrals, so they have a vested interest in making sure you are satisfied.  The chances of Bob T. answering the phone at Di-Tech 6 months from now are slim at best.

Don't give any lender an application fee, it is bogus c**p.  Every lender should be able to provide you with a Good Faith Estimate of what your rate is going to be, what you are going to have to pay in closing costs and give you a bottom line of what you will pay for this loan.

Answer 2

I wouldn't do the search online - call a local bank to set an appointment with them

Answer 3

get with a local mortgage broker and ask them to see about a refinance

I am a mortgage banker in TN & KY

Answer 4

I don't fully understand your question, but it seems that you may want to refinance into a fixed-rate mortgage with a lower rate than you have now (or will have, once it resets), and no prepayment penalty. Seems that the sites you've gone to provided irrelevant or unnecessary information that only served to discourage you somewhat.

This is not a matter of what the media has to say, it's a matter of mathematics. You should know, or be able to find out, how much your rate and payment will adjust, and compare that to the results of a potential refinance. When you get pre-approved, you can review loan programs, rates, and closing costs, and decide if it makes sense to refi.

I will advise you this way: be careful not to put too much faith in the answers offered by some of the people on sites like these.

Some of these people have given you good feedback. Others have absolutely no idea what they are talking about and would be doing you a service if they simply did not confuse you. Those of you that give sound advice know who you are. Those of you who do not likely have no clue that you are doing more harm than anything else.

Avoid "authoritative ignorance", wherever and whenever it may be offered.

Answer 5

You're currently in a 2/28 LIBOR loan.  Get out of it as soon as the pre-payment penalty allows you to do so.

How to shop for a home loan:

1) Talk with at least 3 reputable lenders.  Let them know that you are shopping.  Get a Good Faith Estimate and a Truth-In-Lending statement from each, and show all of these forms to all 3 lenders.  Make sure that you are looking at the exact same kind of loan with all 3 lenders, otherwise you'll have no basis for comparison.

2) DO NOT use a lender that charges you any sort of application fee.

3) Compare the total monthly payments on all of the Good Faith Estimates in the presence of each lender.

4) Compare the APRs at the top left of the Truth In Lending in the presence of each lender.

5) You will see that they get competitive very quickly.

6) Make you choice based on your comparisons above.

7) If the lender changes any of the terms before settlement (or even at settlement), then walk away unless they change back to the original terms.  If you do this, make sure that you walk away with your appraisal, as you paid for it.

8) For credit reporting reasons, don't take more than 14 days to accomplish items 1-6 above.

Use lenders against each other.  It's legal, it's ethical, and it works like a charm!

Good luck.

Answer 6

Wouldn't you be a re-mortgagor?  You are looking to refinance.  Start by calling around to your local banks and credit unions.  See what there rates are.  I'd do this before you start shopping on line.  You can explain to them what exactly your looking for.  I would suggest, if at all possible, you shop for a 15  year fixed rate and see what kind of interest rates and payment you'd be looking at.