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Profile picture for rogerecuador

Does Zillow police their mortgage vendors? What if they don't honor an offer sent from your site?

Yesterday I filled out a mortgage form on Zillow, then got a response from email.zillow.com confiming the rate posted.  Today, the company is not responding well as they say rates have gone up.  If that is the case, what good is an emai quote?  This is my first time shopping mortgates online.  I choose to trust companies Zillow's serch engine provided and who's ads you display.  If they don't honor the offer, who might I speak to at Zillow?

Roger Johnson  @ rjohnson@radiantoptics.com
  • January 18 2011 - Mercer Island
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Answers (18)

Jay, I don't believe any of us did. .... Thanks for responding.

Happy funding, Rudi
  • January 21 2011
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Rudi, I didn't have any rate increases. I bet if he reposted his loan request the same lender would have auto quoted what they quoted him the day before.
  • January 20 2011
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In response to Norm's question, yes once the big banks take the loans then they are repackaged and sold again to fannie and freddie ect.

  • January 20 2011
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Unfortunitly most if not all of the quotes you will see online Zilow included are just pie in the sky quotes to get the lenders phone to ring.

what a strange comment from a confirmed lender. If the information in the request is accurate then the quote is supposed to be accurate. ( at the time quoted).

It's not magic, every loan or well over 95% anyway are ultimatley priced and sold to the  big lenders, Bof A, Wells, Chase, Citi ect

I thought they were ultimately sold as mortgage backed securities mostly to Fannie and Freddie; and
China (which seems to buy a lot of them also).

Can you enlighten me on this?
  • January 19 2011
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Profile picture for Steven G. Hinton
Rates move frequently, it is a pain, but it is also a fact of life. Some advertisers on Zillow do post teaser rates and sometimes errors occur.

If you are not in a position to lock, which would mean full application and appraisal completed, what you want to know is how fees are calculated. 

Interest rates may change but the fees should not.  
  • January 19 2011
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SoCal the main item you failed to mention is whatever the quoted rate is, it cannot be locked until after an application has been taken, a credit report has been received, and the borrower agrees to go forward upon receiving their GFE.

This could be several days before they can lock the rate. No one has the capability to foresee what rates are in the future. So the first thing is finding someone you feel you can trust. And, get at least a little educated on how to wisely make a decision about whom to choose.

Happy funding, Rudi
  • January 19 2011
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Profile picture for SoCal Engr
Roger,

As a fellow consumer, I have never viewed the online rates as "gospel". I do look at them to determine who I think is worth following up with.
 
As an example, if I see someone quoting a wide range of rates...they'll typically also have a wide range of associated fees. I stay away from those folks. As others have said, most lenders will be within an 1/8 or 1/4 point on rates - so lenders with significantly lower rates are going to make you pay for it.

Even worse is the lender with significantly lower rates and showing little-or-no-cost. This is going to be a BS teaser, toss them into the round file.

What should be left is a number of quotes that seem comparable, but they will have different ways to charge fees. A little bit of wading through the information should help you determine who is charging what. My preference is to use a flat-fee lender vice a lender who is charging points - but that is my preference.

Once you've found a few lenders who are in your general area and all seem to be providing similar rates, call them up and talk to them. Find one you are comfortable with, who answers your questions instead of trying to "steer" you into products.

As far as the actual rate you will get, that can be worked out once you find the lende you want to deal with. Rate go up and down, though they recently hit some lows that may not be seen again for a while. However, they generally move around a mid-point, so a good LO can work with you and advise you whether to lock or wait for the rates to drop again.
  • January 19 2011
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@ Aaron & Gordon,

Excellent comments. Thumbs up.

Jay, did you have a price increase yesterday were you wouldn't honor the quoted rate, if you were the OP's quoter?

Happy funding, Rudi
  • January 19 2011
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@Roger,

To answer your general question, yes, we do police lender activity on the site. Lenders who are caught bait & switching or posting quotes that are not possible are reprimanded and even removed from Zillow Mortgage Marketplace.

For your specific case, I have sent you an email to follow up.

-Geoff-
  • January 19 2011
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Hi Roger, Unfortunitly most if not all of the quotes you will see online Zilow included are just pie in the sky quotes to get the lenders phone to ring. We all get pretty close to the same rates so I can't believe it when I see quotes with super low interest rates and very little fees. At the end of the day all lenders make monday the same way, we either make it in fees or your get a higher rate and the fees are paid to us from the higher rate or a combination of the two. It's not magic, every loan or well over 95% anyway are ultimatley priced and sold to the  big lenders, Bof A, Wells, Chase, Citi ect. What it comes down to is finding a good loan officer who will be there for you before, during and after your loan closes. A Good loan officer will return your calls at 8pm or Saturday at 3pm, andd will stay in regular contact with you every few days during the loan process. The loan process is long 30 and somethimes even 45 days, so often what I have seen is loan officers only make contact when they think they have something to report to thier client which can be 7, 10, even 14 days. What many loan officers do not realize is the average consumer does not know the process and just wants to know that everything is moving forward and what date to expect certain  targets to be met. A lack of comunication with your customers is the down fall of any organization. Best of luck to you   
  • January 19 2011
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Roger, you should resubmit your quote and see if the lender that quoted you yesterday did have a change in rates or if they are just pulling your leg.  Also ask for a detailed list of fees and make sure they are putting all the lender fees on the Zillow quote (lots of lenders leave off the appraisal).  Finally if you find the lender is quoting the same rate today as yesterday, leaving off fees, or generally being shady, you should leave negative feedback.

  • January 19 2011
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Roger, I find that most lenders aren't very honest on Zillow.  Most of the offers you see quoted are only available in fantasy land.  As people get desperate for business, they do what ever is needed to make the phone ring.  This happens on every mortgage website (Zillow, LendingTree, Bank Rate, etc.).  A few bad apples start to push the limit and over time the quality of the rate quotes get out of control. The quality of the quotes goes down the drain and people like you get this sort of experience.  Over the past few years, this is exactly what has happened on Zillow and consequently many good lenders refuse to waste their time and money putting quotes on the website.

In general, most mortgage banks offer similar rates and fees (within 0.125% of each other) or else they're out of business.  The large banks (Wells Fargo, Bank of America, etc.) will have slightly higher rates, because people know their name so they can get away with charging a premium.  Pick someone you'll enjoy working with for 30 - 60 days.  I see you're down on Mercer Island, so you have tons of options all around you.  Everyone knows a good lender, because most of the bad ones left the industry.  Ask around your office or get referrals from some family members.  Once you have a short conversation with a few lenders, you should know who you like and what each can offer.  Don't drive yourself crazy splitting hairs on rates and fees. Just focus on who you will enjoy talking to regularly over the next month or two and make sure they can get the job done.

Think of shopping for a mortgage like shopping for gas. If there's a gas station near your home with reasonably priced gas, you just buy it there rather than drive to the other side of town to save $0.02 per gallon.
  • January 19 2011
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If you feel that you were mistreated, you can post a review of the lender so others will be aware of any questionable tactics.

I do agree quotes generally will have a very short shelf life, so keep that in mind to be fair to all parties involved.
  • January 18 2011
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The market did not deteriorate from Monday to Today. Don't chase rates.  The first thing to do is find someone you can trust. From there, everything will work out to your satisfaction.

Happy funding, Rudi
  • January 18 2011
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You have some very good answers here.  The market moves so frequently that a rate quoted may not be there in even an hour.  So find yourself a trusted Mortgage Advisor and let them show you how it works.  Then watch the rates and ask them for their opinion on when to lock. 
  • January 18 2011
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I'm sure they would have honored the offer the time it was made. Offers have time limits that at best expire the end of the day offered. The market moves.
  • January 18 2011
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Profile picture for daveskow
1/18/2011

Roger - these quotes are  best  used for monitoring the market, locate a lender to work with  and  not  to specifically locate a quote to lock on the spot

best thing to do is to reply/ request to  the lenders that send offers that look attractive  immediately upon receiving and reviewing the quotes ( same day ) ....


email back to the people that provide the quotes  the same day and ask whatever questions you have and also ask what they require to lock a rate in ( most require a full loan application to be completed )
  • January 18 2011
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Knowing how quickly mortgage rates can move - nobody can be held to yesterdays quotes. Unless you lock your rate in, the best that anyone can provide is a current status of mortgage rates for your particular scenario at THAT particular time. Rates can (and often do) change several times throughout the day. 

I cannot imagine Zillow policing this...it's simply the way the mortgage markets move. It would be like trying to complain to the people at e-trade that the price of Microsoft stock went up overnight and asking them to honor yesterdays price.

I hope this helps - I know it can be confusing (and often frustrating) shopping for rates online - but I would use it as a guide for trends, and a base to start working from. Then develop a partnership with a good loan officer that can have your scenario in mind and ready to lock at your desired rate.

Good Luck!
Ryan Halset, Realtor
Boardwalk Real Estate | Seattle, Wa
  • January 18 2011
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