gregorygarver.com

ryan4069 · Joined: 22 Jan 2004 Posts: 4

I am building a new home and I will be closing at the end of November. If I use one of the builders recommended lenders, they will pay all closing costs. Who is this Broker (Bank) loyal too? Me or the builder. Who does he work for? How do I know I'm getting the best rate? If it matters I'm in the state of Georgia.

budroscoe · Joined: 19 May 2006 Posts: 5

he will work were ever he can get a job...

squirrelsquirrel · Joined: 08 Jun 2007 Posts: 2

The broker belongs to an independant company outside of the bank , But big banks do have prefereed lenders. Well the best rate is usually calculated against the major banks so whatever your rate is from your lender put that up against the major banks. If it is slightly higher than that is why they pay all closing costs!!!

O · Joined: 23 Dec 2005 Posts: 5

The builders preferred lender is usually a seperate enitity that has an agreement in place. They scratch each other's back. Technically they both work for you as the buyer. You certianly are not getting the best rate though. The advantage of using the preffered lender is that the closing costs are paid for you and you are probably getting a bunch of "free" upgrades. Nothing is free in Real Estate it is just named something different. As far as them being loyal to you or the builder. Once you go under contract and pay the binder deposit that is what you have at risk. If things don't work out like they outlined to you in your good faith estimate then you can walk, but the builder will keep your binder deposit. Good Luck

Rushisaband9893 · Joined: 09 Dec 2005 Posts: 6

Mortgage brokers work for whom ever will pay them. And they often determine their commission (except for the split with the company) independently. The best way to find out of you are getting the best rate/deal is to SHOP AROUND! Be careful, "paying for the closing costs" or lowering closing costs are common offers from mortgage brokers, but these fees are covered by slightly higher rates. There is no such thing as a free lunch!

mindtweak · Joined: 07 Jan 2005 Posts: 3

The Steelers guy knows it. He said it all.The work for both and you could find better deals for the long run and not immediate "deals".

peonies19 · Joined: 09 Dec 2006 Posts: 3

One thing to be wary of with Mortgage Brokers is they're bonused based on how much business they put with a particular bank. So you might not necessarily get the lowest rate out there.Its best to shop at 2-3 different brokers if you're purely looking for the best rate.

iliketodreambig · Joined: 04 Jun 2002 Posts: 4

You have asked 2 questions: who does the lender work for and are you getting a good deal.The lender represents you the borrower. By law they can't disclose information about your loan to the builder - even if it's the builders own lender (like NVR mortgage is owned by NV homes). The main reason the builders pay closing to use a referred lender is that the builder knows that the referred lender will get the loan done. The builder can put pressure on the lender to settle on time. If the lender does a poor job, a large chuck of their business can go away. The builder is being a crook; they have invested a lot of money on the promise that you will settle the home that they have built for you.In regards to the best deal. Shop around when you go to lock in the rate. If you get a better deal somewhere else, tell the builder's lender. In this market, the builder wants to SETTLE the home. If you make a big deal about it and you can SHOW that the 2nd lender can do the loan ON TIME, then you may not have a problem.

Stacy · Joined: 23 Nov 2002 Posts: 8

Get a quote from one of their lenders, and then get one from someone independent from him. If the rate and down payment are similar, go with the one that will pay your closing costs. This will keep him honest. Do not tell him you are shopping him either, just see if he is honest on his own.