Why Lenders Are Not Your Friends - Part 1

Copyright ฉ 2006 Ed Bagley



The next time you go borrowing, and your friendly banker smiles as you walk into his office, be aware that you may be snookered by someone not worthy of your trust. If your banker is an attractive woman, then you are even more susceptible.



I have grown over the years to appreciate a certain breed of bankers as one of the lower life forms that inhabit planet Earth. What I am about to share with you is even more true of certain mortgage brokers, secondary lenders and financial predators.



They operate as sleazy parasites under the guise of helping the least credit worthy consumers who have virtually no savvy in financial matters.



Rather than pick on the worst of this collection of lenders who will help relieve you of your money without any conscience, I have targeted bankers. Before the banking industry was deregulated there were many people who considered bankers worthy of some trust and admiration. Those days are over.



Bankers still enjoy the best reputation (such as it is) among these lenders, but they have no problem patting you on the shoulder while picking your pocket and telling you how much they have helped you.



I do not intend to indict the entire lending industry, just 95% of it. Here is an example:



My 24-year-old son wanted to refinance his first mortgage and was about to go to a leading lender in the market to look at its loan proposal. I decided to tag along because I know how lenders operate, especially when dealing with younger clients and senior citizens who have not handled the finances in their family.



His present loan had a principal balance of $123,773 with 7.458% interest at a 30-year fixed rate.



The proposed re-fi was for $134,999 with 9.9% interest (10.28% APR) at a 30-year fixed rate. The re-fi would cover the $123,773 principal balance due and provide a $10,409 home equity loan. The lender was actually smiling when he outlined what a good deal this was for my son.



I had coached my son to simply listen to the proposal, commit to nothing, take the paperwork with him, and tell the lender he would study the proposal and let the lender know if he wanted to proceed.



Once away from this flytrap I took my son to lunch, and we discussed the great deal he was given.



First, I had him look at the 3% discount fee on the Good Faith Estimate of the closing costs. (The discount fee is the amount you are paying for the privilege of getting the loan.) The discount fee was listed at $312.



What the lender was not telling him was that the 3% discount fee was figured on the $10,409 home equity loan and not on the $134,999 for the total loan which was $4,050, a slight difference of $3,748 in their favor.



If you called the lender on this discrepancy, he would probably say, "Oh, you're right, that's a mistake.



That's the figure for the home equity loan. Jeez, I'm sorry."



When the day comes to close the loan, you see the bloated figure and object, and then the lender multiplies the $134,999 loan times 3% and viola, it comes up correct. You are dazed and confused, feel under pressure, want to get this over with and sign on the dotted line. This happens every working day in America when loans are closed.



Long after you are gone, the lender is quietly snickering, counting up the additional funds he will earn, and welcoming the next dumb bunny who comes through the door while you will be stuck with making payments for 360 months on a lousy loan.



For the uninitiated, there are more real surprises at loan closings in America than when opening gifts on Christmas morning. One client of mine went to a loan closing and learned that $10,000 had been added to the loan closing costs without prior notice; he thankfully got up and left.



Always remember that for every liability you have, you are someone else's asset. For every liability-such as a mortgage, credit card, car loan or school loan-you are an employee of the company lending the money.



If you take out a 30-year mortgage loan, you have become a 30-year employee of the company which lends you the money. This is a very sobering thought when you are paying attention, as you should be. I am not talking about anything important in this article, just your financial health.



Part 2 of this article will take the financial details of the loan apart and show how not taking the loan will save my son $157,495.

What Is A Home Loan Broker?

If you have shopped for a mortgage or are considering doing so, it can be difficult given the amount of advertising information floating around. This is where home loan brokers come in.



What Is A Home Loan Broker?



If you are considering the purchase of a property, refinancing your current loan or even getting a home equity line of credit, you have to work your way through the morass of mortgage advertising material. Given the vast amount of information on the web, radio commercials and television advertisements, how do you know which loan is best for you?



Well, you have to do a lot of homework.



You need to gather up the various information provided by the lenders and start comparing the offers. Issues to consider include points, interest rates, length of the loan, prepayment penalties and fees. Frankly, it is a lot of work and makes preparing a tax return look like a walk in the park.



One way to avoid this mess is to get someone else to do the work for you. In this case, the person is known as a home loan broker or mortgage broker. These home loan brokers are independent agents who shop through the various offers from lenders ever day.



All they do is mortgages, so they know the difference between a good loan and a bad loan. In simple terms, they do all the research for you.



When you use a mortgage broker, the process is so much simpler than doing it yourself. The broker will talk to you about your lending needs and pull your credit report. He or she will then tell you how a lender will view you in evaluating an application for a loan. The broker will then either suggest steps to be taken to improve your profile or provide you with the various options available to you.



The next step is actually applying for the loan.



Appling for a home loan is the ultimate in red tape and paperwork. A stunning amount of forms must be filled out and documents provided. If you hate to waste your time with this stuff, a broker is definitely going to help. Home loan brokers have a person called a processor on their staff. This person's job is to gather all of the relevant information and forms. They then put together your loan package per the lender's requirements and submit it.



When the lender inevitably loses something, the process is right there to get them the information. Essentially, it makes your life much easier.



The final advantage of a home loan broker is communication with lenders. If you have ever applied for a loan, you know the lender representatives are hard to get a hold of and rarely call you back. Brokers do not have this problem. Since brokers place a lot of loans with lenders, they get preferential treatment. They are a business source for the lenders, so you can bet the phone calls of the broker get returned immediately.



This, of course, is beneficial to you since the broker will be able to keep you appraised of where things stand with the loan.



Even a quarter percent savings on a home loan can save you thousands of dollars in payments over the life of the mortgage. Mortgage brokers are the best way to find that loan that is going to create those savings for you.

The Future For Mortgage Brokers Part 5

Mortgage Brokers in the UK



The mortgage broker industry in the UK has been negatively affected by the credit crunch more than any other country in the world, apart from the USA. The boom of the late 1990s and early 2000s officially ended in late 2007 when the credit crunch became a reality. The following few months saw the closure of hundreds of estate agents and mortgage brokers up and down Britain as the property market came to a standstill.



Lenders pulled products from the market by the thousand. It seemed that all that remained was products for existing home owners with lots of equity in the homes. This left first-time-buyers and home owners with little equity in their properties with no options for remortgages or new mortgages when moving home. The property market ground to a halt and the boom was officially ended.



In the meantime the Financial Services Authority was uncovering widespread fraud within the mortgage advising industry.



Brokers were being suspended, fined, banned, and even jailed as sophisticated property scams were being unearthed. Through the investigations conducted by the FSA it was becoming evident that unscrupulous mortgage brokers were involved in activities designed to defraud lenders with loose lending criterion out of millions of pounds.



The combination of performing few checks on borrowers’ credit histories, earnings etc and the ease at which properties could be overvalued by surveyors led to a situation in which brokers who knew how to play the system could apply for mortgages greater than the actual value of the properties they were buying.



Those involved in the scams would purchase the properties with the majority of the proceeds of the mortgage and simply pocket the difference.



Needless to say the credit crunch and subsequent drop in the average value of property in the UK helped reveal such indiscretions. Individuals who had previously secured mortgages against properties over and above the true value of the underlying assets were now unable to remortgage their properties as surveyors were no longer overvaluing the same properties.



While it should be noted that it was not only mortgage brokers involved in these scams, some brokers were and have subsequently helped to give the profession a reputation it does not deserve.



After the initial fallout of the credit crunch the property market in the UK has begun to stabilise. Net lending of mortgages is no longer plummeting and more favourable products are returning to the market. Borrowers are starting to be given more choice with regards to the products they can choose from which means that lenders are beginning to see some light at the end of the tunnel.



For mortgage brokers, this means that there are more products to market to their clients than there were a year ago. This is welcome relief for the industry but is nowhere near the level it was during the heyday of the property boom. It could be said that a return to those days would not be a good things for the property market and the mortgage profession because the crash has helped to uncover and weed out inefficiencies in the industry.

How to Find a Really Good Mortgage Broker

There are hundreds of mortgage brokers in operation, in fact there are actually more brokers than banks in many towns. A mortgage is quite likely the biggest financial commitment you and your family will make, it's important to make sure you are getting the best product to suit your needs. Enlisting the services of a mortgage broker can no only help you find the best deal but also make the process a lot easier for you.



With so many mortgage brokers out there, it's difficult to know who to choose.



There are some industry sharks out there that you definitely need to avoid. The first thing to keep in mind is that mortgage brokers get paid by the bank, not you. Look out for brokers that will stitch you up into a loan that pays them the highest commission. While it is a minority there are some out there that will do it. The accounts are often laden with high fees and interest rates.



Before you make inquiries in person, and hopefully before you purchase property, start doing your own research.



Find out who the local brokers are in your area. Some will be large organisation, usually with a brand name you know and with a office in town. Others may simply be single operators working from a home office. One is not necessarily better than the other.



Have a look at some newspaper ads and check out the web sites. Narrow your choice down to two or three brokers that you feel like you might wish to deal with. Good brokers will offer you a no obligation consultation. Make the time to sit down with the ones that you like.



A one on one meeting with a mortgage broker will give you a good idea of their operation and work ethic. Presentation and professionalism speaks volumes. A good broker, even if a little messy in nature, will always be well presented and have a pleasant area set up for meetings with clients.



Come prepared with a list of questions. Ask about the process and what happens. Find out how long they usually take to get formal approval on a loan. When you sign a contract to purchase property you will usually have a deadline on your finance clause you will need to meet.



Familiarize yourself with the lenders on their panel, they will be able to give you some information on this. Also ask if they have any affiliation with a particular bank as it is likely that they will. Most brokers have a strong relationship with one particular bank, this doesn't mean that you shouldn't use the broker, just that you need to be aware of it.



Once you've found a good broker things will get easier for you. They key is to always know what you are signing up for and make sure that you have read the fine print.



A good broker can definitely help you along the way.

What Are Mortgage Brokers And Why To Use One

"Mortgage" is formed from two words: the French word "mort" meaning "dead" and the word "gage" from Old English meaning "pledge". Sir Edward Coke (who lived from 1552 to 1634) explained the term: the land as considered "dead" to the mortgagor, as if the person never had it.

Today, the term mortgage is used for a loan for purchasing propriety. The most common
mortgages are the home mortgages. It is not common to pay cash a home today.



The
"life' of a home mortgage is from 20 to 30 years. During all this years, the owner will pay
regularly and with the specified amount. There is also a term for the interest rate,
established to respect the seller and also the buyer conditions.

Most people think at a bank when thinking at a mortgage. It is the most trustful way to
get a mortgage; even the banks are asking the most rigorous set of documents to approve
it. The stability has its price: banks don't give the best interest rate, but there is also the
possibility to negotiate for the best acceptable solution.



Pertinent information empowers the burrower with the knowledge to make appropriate
decisions for his family and themselves.

The banks are making their money from activities like mortgage, so there will be always
good solutions for everyone. People can "shop around" to find the best mortgage
condition.

What are the mortgage brokers? They are making all the legwork for the customer.
Specialized websites are offering "perfect loan programs" in a few minutes.



A
professional research must be made to find the appropriate opportunity to buy the house
of our dreams.

Financial brokerage is a licensed company or individual who obtains a loan for borrowers
by selecting the best available solution at the best available rate. Real estate brokers help
borrowers to get a loan in accordance with their needs, making in the same time a
profitable investment for the financial brokerage or lender. All the work can be done
online, leading to a fast win-win situation for all.



The load mortgage broker has a professional expertise with direct access to many loan
products, providing customers efficient and cost-effective options that are meeting their
specific needs. He will provide customers with choice, convenience and expertise.

A good broker is the customer's mentor, guiding him to the entire loaning process,
balancing the client's financial goals, offering extensive choices.

A professional mortgage broker is using loan packages with less than perfect credit histories,
permitting to his customers to enjoy the benefits of home-ownership.



A mortgage broker isn't a banker, neither another financial lender. He is (or must be) a
real estate professional offering products and services. A broker can act as a banker too,
when funding loans.
Maybe the best part of a home mortgage broker activity is the help he is giving in
assessing the requirements and saving the customers time. Having contact with many
banks they can offer advices on the ways to overcome the frontiers to loan qualification.
A mortgage broker also knows the laws and regulations, simplifying the borrowers' task.



He is taking the application and obtains the credit report and appraisal. He counsels the
customer on the approval process; obtain the credit report and appraisal, collecting the
necessary documents. He also provides separate services and facilities to wholesale
lenders; market the lender's product also. Mortgage broker also is assembling and
delivering the completed loan package.

The mortgage broker really cares about the quality of the loan; the safety and soundness
of the mortgage lending community is linked to the success and efficiency of its home
loan originations.



Consumers who exercise their choice choose mortgage brokers because
they are dedicated to their customers, who are the consumers, and in the same time the
wholesale lenders.

May the broker steer consumers to the lender who pays the highest fees to the broker?
Isolated instances of steer can occur, but the free-market economy is protecting the
customer giving him a powerful weapon: the vigorous open competition. Each consumer
can shop and compare the prices; his final option will lead him to the best solution.



The
level of choices has no precedent.

For more information about Mortgage Brokers please visit our website at: http://www.better-mortgage.net

Exclusive Mortgage Broker Leads

When getting a mortgage, borrowers fill the lead forms in person at the lead provider's office or online at the lead provider's website. Except in the case of Internet Mortgage and Telemarketing Leads, the lead providing companies collect the leads during office working hours, and then mail them out at night to brokers. This means that there's at least an overnight's delay in the lead transfer process.

If, on the other hand, Mortgage Brokers have their own web sites that can gather Mortgage Leads, will it not be better? Today, Lead Proving Companies are bringing in the advantages of Web based technology to their Broker clientele as follows: They help the Mortgage Broker, who is registered in their site, with efficient Lead Generation and Management Systems.



These are basically web pages that can be handled by the brokers independently. They are designed in such as way that they cover all lead distribution needs as desired by the broker.

By using such Lead Generation and Management Systems the broker can manage the content, upload an Online `Form of Request for Loan' filled in by the Borrower, track visits [knowing the number of people who visited the web page], advertise the website in search engines, allocate the desired choice of lead format - html emails, .



pdf email attachments, text files, fax, etc. and accomplish many more tasks.

Several independent Mortgage Brokers and Broker Firms go in for this type of system due to its obvious advantages. Broker Firms use the system with an option to work as an exclusive system [where leads reach one loan officer] or non-exclusive system (where leads reach many loan officers) by using their networking facility.

Though these leads cut an edge over other type of leads, these are more expensive, as such systems include a custom designed web site, a few hours of internet and search engine marketing.



Lead Providing Companies usually charge a setup fee for the site and a fee per lead with a minimum stipulated fee. Let's take an example. A Lead Provider charges $1,000 for the website and $1 per lead per day, or a minimum fee of $30 if the leads are less than 30 per day. If the Broker's web site mobilizes 50 leads per day, the monthly fee comes to $50. If on the other hand, the site collects only 25 leads per day, the monthly fee is $30. The price includes electronic data transfer just like in paid web based email services.



Though relatively expensive, speed, confidentiality of data and the degree of freedom to the Broker render Exclusive Mortgage Broker Leads unique and popular.

Exclusive Mortgage Leads provides detailed information about exclusive mortgage leads, exclusive internet mortgage leads, exclusive telemarketing mortgage leads, exclusive real time mortgage leads and more. Exclusive Mortgage Leads is the sister site of Life Insurance Leads.

Mortgage Seo - Search Engine Optimization For Mortgage Brokers

Mortgage SEO, or search engine optimization, is the act of improving your mortgage marketing website for better search engine visibility and ranking. This leads directly to increases in website traffic, which (if you have a lead generation strategy in place) translates to an increase in web-based mortgage leads.



All good things, yes?



So here are quick tips for mortgage SEO that will help you improve your mortgage website's search engine ranking:



1.



Add 10 pages of content to your website.

Do some key phrase research and come up with 10 phrases relevant to your products and services. Write a page of content (or pay somebody to) on each of those phrases. Incorporate this new content within your site. You've just increases your potential search engine visibility for those phrases. Not too hard, was it?



Increasing a website's size by adding quality content is one of the easiest, most low-cost strategies for mortgage SEO.



The volume of content on your mortgage website is the one thing you have total control over, so why not take advantage of that for mortgage SEO purposes?



2. Submit a press release online.

When you publish a press release online through a service like PRWeb.com, you have the opportunity to include hyperlinks within your release that link back to your mortgage website. This helps increase your "link popularity," which has a direct influence on your search engine visibility.



You'll also get plenty of exposure through the press release itself. Double benefits!



3. Start a mortgage blog.

If you're serious about mortgage marketing online, you really should launch a mortgage blog. The benefits of blogging are many. It helps you grow your website, acquire inbound links, build your reputation, inform your readers, reinforce your brand … the list goes on. Best of all, blogs are easy to use, even for web novices. If you can type an email, you can publish a mortgage blog.



Conclusion

Do all of the things on this list require an effort on your part? Absolutely. But when it comes to mortgage SEO and search engine ranking, effort is what separates the front-runners from the "also ran" contenders.



* You may republish this article online if you retain the author's byline active hyperlinks below.

Mortgage Brokers and Realtors Team Up With the Help of a Colorado Web Design Firm

Denver, Colorado (PRWeb) August 20, 2003- The bumpy road the economy has taken lately and the recent increase in interest rates have caused both Realtors and mortgage brokers to search for new ways to bring in leads and generate new clientele. A Colorado based web design firm, Internet Media Consultants, has developed a program where both mortgage brokers and real estate agents can benefit by a strategic partnership.







Mortgage brokers are able to recommend that a Realtor has a website designed by Internet Media Consultants, and in exchange, the Realtor will refer all of their clients who need a mortgage loan to that mortgage broker.



In some cases, the mortgage broker even invests in the design and hosting of that website, just to secure a steady channel of leads are directed to him/her only. โ€œComing from the mortgage industry, I have never seen anyone facilitate a strategic partnership between these two entities quite like this.โ€ said Jason Christiansen, founder of Internet Media Consultants. โ€œThe benefits to both parties are immense. Every Broker or Agent I approach with this idea can't believe what a simple and effective lead-generation tool this is.



โ€







Real estate professionals are provided with a website that incorporates cutting edge technology to propel their business ahead. A real estate website enables the agent to display property listings (complete with photos, information, even a virtual tour of the property) with a powerful, user-friendly database, and it instantly uploads onto their website. This powerful yet simple tool amplifies a real estate agent's leads from local to a national platform. Each design and hosting package includes 170 pages of mortgage information and 16 interactive calculators, a free listing in a state specific real estate directory on multiple consumer websites, and a 24/7, interactive resource for their customers to check interest rates, prequalify and apply for a loan.



These loan applications are what the partnered mortgage broker is looking for.







About Internet Media Consultants:



Based in Littleton, Colorado, Internet Media Consultants specializes in internet and website consulting services, mainly in the real estate and mortgage arena. Their services include website development, web hosting, search engine optimization, internet marketing and database applications.







CONTACT INFORMATION:



Nikki Christiansen



Internet Media Consultants



888-226-9370



303-978-1536



http://www.



imc101.com

The Current Mortgage Rate

The Current Mortgage Rate







So you are looking to purchase a home or refinance the one you are currently living in. If this is the case, not only do you want to obtain the best mortgage rate out there, you want to obtain the current mortgage rate and not a percentage point higher.







Before you begin to track down a lender who can get you going with a current mortgage rate, take some time to do a little research to find out what the current mortgage rate is on your own.



Donย't just take the lenders word for it.







You can find out information on the current mortgage rate, and rates in general from many resources. To name a few, the internet or the business section of your local newspaper is a good place to start and will give you a very good idea of what rates are doing.







The current mortgage rate can be easily obtained if you have excellent credit, or what lenders call ย"Aย" credit.







However, if your credit is challenged in any way, you will still be able to get a mortgage.



Except the rate you receive may not be the current mortgage rate, but a little bit higher because the lender sees you as a slight risk because of your payment history.







Wether you have excellent credit or challenged credit, or you need someone to help you out with a unique situation, shop around.







By shopping around, you allow for a few to several mortgage brokers or loan officers to assess your situation.







Once each loan officer is finished assessing your situation, they will get back to you with what they have to offer rate wise.



Once you have a number of offers, base your decision on what you believe to be the best loan scenario for you.







Remember, the mortgage industry is a very competitive one, and these lenders do not want you to take your business to their competitor, so they will do their best to get you the best deal out there.







Loan officers and mortgage brokers also get paid on commission, so getting the mortgage to the closing table is just as important to them as it is to you.

Free autoresponder system for mortgage brokers at mortgagefollowup.com

February 13, 2004 - boberdoo.com LLC (www.boberdoo.com), an advantage of the company's distribution software, announced the launch of mortgagefollowup.com (www.mortgagefollowup.com). Mortgagefollowup.com is a free service for mortgage brokers that allows agents to automatically track your mortgage leads. The system has built in e-mails from the sample, and also offers mortgage brokers the opportunity to create their own custom games for each situation.



Mortgagefollowup.com assist mortgage brokers in keeping the face in continuous time with potential customers who are better interest rates or unwilling to fill out a new mortgage when the first word. Historically, mortgage brokers have given the pace of buyers and potential customers, but with interest rates and prices of lead, it's a bad habit of calling broken.Every receives a mortgage broker can be classified different situations.



Some cables are better interest rates for mortgage refinancing buyers time, some pieces are first, and other tracks are just looking to ask questions about the mortgage process. The system allows mortgage brokers mortgagefollowup.com assign to each of these cables for specific groups even email depending on your situation. Once defined, the pilots will receive tracking emails on a daily or weekly basis, each is personalized to them and the mortgage broker.



These messages contain information relating to why the broker said. Following these cables are not willing to buy at the first call, the mortgage broker to automatically keep your name and address on the front of the sensor so that when you're ready to buy, the broker will be the person Contact. We receive a large volume of telephone calls from mortgage brokers who are in desperate need of more mortgage leads, "said Brad Seiler, owner of boberdoo.



com. We created mortgagefollowup.com as a tool to help mortgage brokers realized that, along with new tracks, which should review the tracks you already have. From my experience with runners, I found a good proportion of them are impatient with their potential customers and instead of working "average lead, just throw away and go to the next. Mortgagefollowup.com form enables these agents automatically his current job while keeping their new ones.



Mortgagefollowup.com is a free service. It allows brokers to have up to 25 leads active in the system at any time. The system requires brokers register and verify themselves by calling toll-free. After checking the runners can start adding leads to the system using the example of groups including by email or can create their own groups with their addresses own graphics and / or logo and also attach PDF files to your outgoing email.