Profile picture for njbuyer1

i RECEIVED A QUOTE OF 4.875 BUT THE apr WAS 5.51. wHY SUCH A BIG SPREAD BEETWEEN THE

TWO RATES? Im just trying to understand so I dont get taken for a fool and make a bad deal. should I be concerned? property is 330k im putting down 20g and my scores range from 766 to 798.

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January 23 2009 - Englewood
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Answers (13)

nj... If nothing is locked then the 45 day clock has not started and you would be at the mercy of the lender telling you what the rate is.  With that loan amount and credit score there is no reason why you should not get 5% without the origination fee.  You have to asak your self what is more important to you.  The 1/8th in rate or $3300 in your pocket.  If you are okay with the origination fee then you can do better than 4.875% 
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January 23 2009
Profile picture for Entitlements R Us
I love it when they call me Big Poppa! Wave ya hands in air, if yous a true playah!
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January 23 2009
Profile picture for Ken Kopper
I agree Rob..NJBuyer, you are are a good rate @ pretty much PAR but you are paying 1 point (broker is calling it origination but its still a point)

There are two types of points that can be paid, origination and discount

You are not getting a bad deal but the person you are dealing with is not being forthcoming and that worries me about what else he/she is misprepresenting. Good Luck with everything

CALL JOE!
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January 23 2009
Profile picture for Rob Cochems
I love it when lenders say there is an origination fee, but there are no points!
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January 23 2009
Profile picture for njbuyer1

i didnt lock anything but they said it was good for 45 days. there was an origination fee of 3375 i believe and there were no points

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January 23 2009
nj...not sure if my GFE exactly links up with the one you have in front of you but the clsoing cost figue seems high.  Two questions I would have is 1. Are you locked in at the 4.875% ( from what you have said I do not think you are but wnat to make sure) and 2. You mention no points.  Is there an origination fee.
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January 23 2009
Profile picture for njbuyer1

Ok so re checked the info and the Down payment was not 20 but rather 3.5 %. it was an fha loan. Below are some of the details.

total cash to close was 21k which consisted of the below:
closing cost 6711
total prepaid expenses 2737
down payment 11550


it also included the below which i dont know what they are
Mi/MIP was 145.96 a month

LTV was 96.05%

no points

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January 23 2009
NJ
You should have Joe take a look at your Good Faith Estimate, (he is a top notched zillow lender and knows his stuff)
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January 23 2009
NJ...The 4.875% is the rate the payment is based on.  The spread between that rate and the APR could be one of two reasaon.  The first is that there are a lot of fees (points, origination) being charged.  The other reason is that you were offered a FHA loan and the UFMIP has to be figured into this calculation.  Do not concern yourself so much with the APR. The important thing to do is to get GFE's from a couple of lenders that you want to work with and see the actual costs that are going to be involved.
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January 23 2009
Profile picture for Ken Kopper
I am sorry, I made a huge assumption that the quote was for a FHA loan.
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January 23 2009
Profile picture for Ken Kopper
NJ, I believe Zillow is calulating in the Upfront Mortgage Insurance Premium in the calculation of the APR.

Have the lender prepare a TIL for you and send it over.
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January 23 2009
There are many possiblities as to why.  Please provide more info for us to review. Fixed or ARM loan? Rate is 4.875; what are the points if any?  It's a 94% LTV - what did they quote for PMI? Post the whole good faith estimate figures will help disclose what is going on. 
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January 23 2009
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You are getting taken to the proverbial cleaners.
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January 23 2009
 
Related Questions
i RECEIVED A QUOTE OF 4.875 BUT THE apr WAS 5.51. wHY SUCH A BIG SPREAD BEETWEEN THE
Profile picture for Joe Cafiero
Latest answer by Joe Cafiero
January 23 2009 | 13 answers
Mortgage Rates
 
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