First, make sure you are working with an experienced,
professional finance associate. A large financial transaction is far too important to place into the hands of
someone who is not capable of advising you properly and troubleshooting
the issues that may arise along the way. But how can you tell?
Here are 4 simple questions your lender ABSOLUTELY
must be able to answer correctly. If they do not know the answers...
RUN... DON'T WALK... RUN... TO A LENDER THAT DOES!
- What are interest rates based
on?
The only correct answer is Mortgage Backed Securities or Mortgage
Bonds, NOT the 10-year Treasury Note.
While the 10-year Treasury Note sometimes trends in the same
direction as Mortgage Bonds, it is not unusual to see them move
in completely opposite directions. DO NOT work
with a lender who has their eyes on the wrong indicators.
- What is the next Economic Report or
event that could cause interest rate movement?
A professional lender will have this at their fingertips. For
an up-to-date calendar of weekly economic reports and events
that may cause rates to fluctuate, sign up for the Finance
Point Direct.
- When Greespan and the Fed "change
rates", what does this mean... and what impact does this
have on rates?
The answer may surprise you. When the Fed makes a move, they
are changing a rate called the "Fed Funds Rate". This
is a very short-term rate that impacts credit cards, credit
lines, auto loans, and the like. Rates most often will
actually move in the opposite direction as the Fed change, due
to the dynamics within the financial markets. For more information
and explanation, feel free to give us a call.
- What is happening in the market today
and what do you see in the near future?
If a lender cannot explain how Mortgage Bonds and interest rates
are moving at the present time, as well as what is coming up
in the near future, you are talking with someone who is still
reading las week's newspaper, and probably not a professional
with whom to entrust your home mortgage financing.
BE SMART... ASK QUESTIONS...
GET ANSWERS!!!
We do this every single day.
It's our profession and our passion. We're ready to work for
your best interest.
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