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Am I getting a good rate?

I am buying a house for $320,000 and putting a down payment of 10%. My mortgage company, which is through the builder, is quoting me interest rate of 5.625%. If I decide not to use the mortgage company through my builder, I lose 60k of incentives. I will have to end up getting a loan of 380k from outside. Should I go with my builders mortgage company or somewhere else?
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August 18 2009 - Longmont
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That's a pretty high rate.  What fees are associated with that rate?  Who is the builder?



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August 18 2009
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Standard Pacific is the builder. 5.625 is just the interest rate. I think APR with be higher. I am trying to find that out from the the mortgage company.
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August 18 2009
That rate is very high especially if you will be paying points. 
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August 18 2009
Could you explain the builder incentive again, it makes no sense.

The Builder can not give you $60k. 
What is the sales price?
Downpayment -
How much is the Builder paying towards Closing Costs?
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August 18 2009
Profile picture for kp112200
Original sales price is 380k. If I go with the builders mortgage company i get 60k in incentives. Making the final sales price of 320k. My down payment will be 10%, 32k. Builder is not paying anything towards the closing cost.
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August 18 2009
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The builder sounds shady to me. 
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August 18 2009
So the contract will read Sales Price $320,000 if using their lender and if Colorado Lender ( above ) does the loan with way better terms, then the contract will read Sales Price $380,000? If that is correct, I agree with oldskoolballr, it's shady. Do you yourself understand why it is? 
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August 18 2009
Builders in general are desperate to sell homes in this market.  Demand that they either force "their lender" to offer competitve interest rates or allow you to use a lender of your choice.

They are sitting on tons of inventory in northern Colorado so should be pretty open to accomodating your request.
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August 18 2009
I bet the Builder's Lender's Appraiser sleeps well.
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August 18 2009
Are you purchasing as an owner occupant?
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August 18 2009
That doesn't sound right at all!  What are the incentives?  With rates as low as they are right now, 5.6% sounds very high to me.
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August 18 2009
What you are saying is against the law. Standard Pacific is a class act builder. I would bring this to their Corporate attention in Newport Beach, CA. If that doesn't work contact the CO Deptartment of Real Estate. ... Best wishes, Rudi
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August 18 2009
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Thanks all for your replies.
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August 18 2009
Actually, that might not be a bad rate. Many lenders require 20% down these days, so the arrangement the builder has with this bank might allow a lower down payment in exchange for a slightly higher rate. You might want to check with other lenders....
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August 18 2009
Stick to the real estate advice Spence.
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August 18 2009
If the builder is willing to sell the home for 320k he will do it regardless of the lender.  You are the buyer and in this market, you hold the cards. 
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August 20 2009
 
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