Mortgage Referrals
Definition of "Mortgage Referrals"
Advice on where to go to get a mortgage. A borrower can always select a loan provider by throwing a dart at the Yellow Pages. A referral is of value if it raises the probability of a good outcome above that from throwing the dart. The four major sources of referrals are real estate sales agents, other borrowers, Internet referral sites, and builders. Real Estate Sales Agents: Home purchasers accept more referrals from real estate sales agents than from all other sources combined. Sales agent referrals generally are to individual loan officers or brokers, as opposed to firms. An agent with great confidence in a loan officer will continue to refer clients even when the loan officer switches firms. Sales agents have the same interest as buyers in completing transactions. Hence, they refer clients to loan providers who can generally be depended upon to close on time. This is the agent's major concern, and it is a concern of borrowers as well. Sales agents have no comparable interest in the mortgage price or whether the borrower is placed in the right kind of mortgage. However, the agent doesn't want the price to be so far out of line or the service provided so abysmal that the borrower throws a fit and blames the agent. Other Borrowers: Referrals from other borrowers are usually based on a single transaction. Internet Referral Sites: These Web sites provide price information for a large number of lenders and mortgage brokers, usually listed by state. They also provide quick entree to the Web sites of each loan provider listed. Builder Referrals: Builder referrals are usually to a lender with whom the builder has a financial arrangement. Hence, they are suspect. In some cases, preferred lenders price loans above the market and kick back some of the excess to the builder. Self-Referrals: Responding to self-referrals (solicitations) usually is a bad idea. Not all lenders who solicit are predators, but all predators solicit.
Popular Mortgage Terms
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The sum of all interest payments to date or over the life of the loan. This is an incomplete measure of the cost of credit to the borrower because it does not include upfront cash ...
A charge imposed by the lender if the borrower pays off the loan early. The charge is usually expressed as a percent of the loan balance at the time of prepayment or a specified number of ...
Fees collected by a loan officer from a borrower that are lower than the target fees specified by the lender or mortgage broker who employs the loan officer. An underage is the opposite ...
A lenders requirements regarding how information about income and assets must be provided by the applicant and how it will be used by the lender. The following categories have evolved in ...
A lender that holds the loans it originates in its portfolio rather than selling them. ...
The standards imposed by lenders in determining whether a borrower can be approved for a loan. These standards are more comprehensive than qualification requirements in that they include ...
Mortgages delivered using the Internet as a major part of the communication process between the borrower and the lender. ...
The total cash required of the home buyer/borrower to close the purchase plus loan transaction or the loan transaction on a refinance. Required cash includes the down payment, points and ...
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