Jan. 13, 2007 - Why is his rate lower than my rate?

Now THIS is "transparency"!!  Of course transparency can give you a headache...but this is what transparency looks like.

Study the relationship of credit score to rate.  LTV to rate. 

People ask "what are interest rates today" and think about buying a home, as if they are #1 down there at 5.875% interest rate only to find that THEIR RATE is more like #2 or #3 at 8% or more.

Interest rate is only the rate you see quoted all over the internet, if your score is above 660 and you have 20% down or are willing to pay MI. 

1. PURCHASE: 664 CREDIT SCORE, STATED/STATED , 30 YEAR FIXED NO PREPAY WITH A RATE OF 5.875%. NO ESCROWS WITH AN 80% LTV. CLOSED 1/9/07

2. PURCHASE: 603 CREDIT SCORE , STATED INCOME , NO RESERVES , 90% LTV , 3 MONTH SELLER SEASONING , 8.625% 2/28 ARM WITH NO MI AND NO ESCROWS , CLOSED 1/5/07

3. REFINANCE: 438 CREDIT SCORE , BK 13 BUYOUT/FORCLOSURE BUYOUT , 70% LTV CASH OUT. ROLLING 1X120 MORTGAGE HISTORY AND 6 MONTHS BEHIND ON TRUSTEE PAYMENT FOR BK. 2/28 ARM NO PREPAY 10.99%. CLOSED 1/5/07

I "lifted" this off of a site of a lender in Bensalem, PA.  I would link to it, but the blog was just started and has only one entry.  So I'll come back later when he adds a few things and link to the actual site.  I hope he keeps this up every week, because this is really interesting detail, for those who like to know the real why of things.

If you don't "get it", don't feel bad.  Even I don't know what "3 month seller seasoning"  means.  Seasoning is usually about the downpayment funds and is buyer seasoning and not seller seasoning.  If the lender requires 3 month seasoning...it usually means the buyer needs to have the downpayment monies in his account for 3 months, and not have deposited them last week.  Maybe it's a typo and he meant to say 3 month buyer seasoning.  I'll have to ask him when he gets his blog underway. 

Jan. 23, 2007 - re: Why is his rate lower than my rate?

Thanks for all the useful info, Ardell!  I just found your site today through the 2000 Bloggers list... I'll be back!

Cheers!

Jan. 23, 2007 - re: Why is his rate lower than my rate?

Jan. 24, 2007 - re: Why is his rate lower than my rate?

Jan. 24, 2007 - re: Why is his rate lower than my rate?

Hi Jeff,

Thanks for stopping by.  I do think it helps people to know as much as possible before they find the house they want to buy.  Takes some of the fear out of buying and selling.