Bucking The Real Estate Trend-Waynesville and Maggie Valley Real Estate

Originally posted on The XBroker by Jeff Corbett.

If you are in the process of getting a mortgage and you can’t answer these questions, YOU ARE AT RISK:

1. What is the PAR interest rate for the programs you qualify for?
2. How much is your broker making on the front and back ends of your deal?
3. What is the definition of YSP? I don’t care who’s handling your mortgage or how much you trust him, if you don’t know what PAR rates are or how much he/she is being paid.

YOU ARE A FOOL.

Odds are, you’ve never been quoted the actual rates/terms you qualify for and have no idea how much your loans are really costing you. Why? Because the system is broken.

Lenders pay brokers a handsome commission for selling you interest rates that are higher than what you really qualify for (above PAR). It’s called yield spread premium (YSP) and it’s just one of many ways the industry turns your money into their money.

The law requires brokers to disclose YSP, but it’s usually beyond the average consumer’s ability to detect it. Bankers, on the other hand, don’t have to tell you—which is why knowing your PAR rate is so important. Without it, there’s no way to figure out what your loan is really costing you, both short and long-term.

…Continued ~ Read the rest of this great article here.

Originally posted on The XBroker on August 31, 2006 in Mortgage News.