Profile picture for user1048789

Freddie Mac reported an average 30yr FRM of 4.57% with .8 points. What does this mean?

I am citing the 9/12/2013 data from http://www.freddiemac.com/pmms/ .

My wife and I have great credit scores (both above 780), we are putting down 25% on  our house and yet our mortgage broker is giving us a rate of 4.625. I questioned why it was above the average of 4.57% listed on Freddie Mac's website and he cited the fact that they also list an average of .8 points on loans.

I am not very familiar with this but I still feel with our credit we should be below or at that average with 0 points. 

We are currently pursuing a short sale and were just told the short sale must be closed in 2 weeks or the lender is transferring the loan and we would have to restart this incredibly long process. I worry he is trying to take advantage of us being in a tight spot and not being able to shop around. 

Am I right to be concerned? Any advice would be much appreciated
  • September 13 2013 - Noble Square
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

 
 

Answers (6)

Profile picture for Andrew Malak
You pay points to get a better %. Rates went up recently.
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Here is a good explaination.. Click Here
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Keep in mind that Freddie Mac is taking a small sample of banks and using the average interest rate along with the average points per bank. It is up to you the consumer to decide if you want to pay points in order to get a lower interest rate or not. Also, always compare apples to apples-never take an interest rate from last week or yesterday and compare to todays rate. 

Good luck.
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

First I want to let you know that you should have absolutely zero problems finding a loan.  You and your wife's situation is a perfect transaction for any mortgage lender.  The quote that you have found from Freddie Mac's website is a national average.  Each lender will have comparable rates nationally too.  The Lending compensation rules changed in 2011 and every lender has different compensation structures resulting in what rates they offer making it tougher to shop and negotiate the best loan for you and your family. What you need to do is compare the lowest rate you can get to the expense of what it takes to get that rate. The lowest rate is NOT always the Best Rate for you and your family.  If you would like me to explain further please reach out to me. [Spam removed by Zillow moderator due to violation of Good Neighbor Policy.] I wish you the best.
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Profile picture for Matt Laricy
I don't think he is trying to take advantage of you at all. Some rates are just different. Get a second opinion but if your stretches for time, you can either walk from the deal or take the rate
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

All rates depend on many factors, your area, credit, debt to income etc. Just because the national average is rate X doesn't mean everyone is entitled to it. I understand you have great credit and so and so forth but there are other factors that go into what rate you actually qualify for.

Rates are moving up and I won't be surprised if they hit close to 5% by Nov. So a 0.055 % difference in a rate shouldn't be a concern. Shop for a different rate if that low of a difference means that much to you.

Best wishes!
  • September 13 2013
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.