Mortgage Tricks: You Can’t Trick A Magician

I was reminded this week of one of the “oldest tricks in the book” from a borrower when shopping for a mortgage. Because of the lack of transparency in the mortgage industry, there are a few tried-and-true tricks that mortgage folks use and by sharing them, my hope is that you won’t fall for them.

When comparing lenders, the first step is to get their best offer in writing. This is called a Good Faith Estimate and any loan officer can easily produce one for you after taking your application. The Good Faith Estimate outlines the interest rate, fees and payment of your new mortgage.

Here is how the trick works.

After you speak with a loan officer and get your first Good Faith Estimate, you go on to the next loan officer. If you let him know that you have spoken with another loan officer and have a Good Faith Estimate, he might ask you:

“Oh, good – just send me what he sent you and I will see if I can beat it…”

Don’t fall for it!

This is a trick because it allows the 2nd loan officer to be “lazy” and just see if he wants to / is able to “beat” the offer to do your loan.

So when shopping for a mortgage, be sure to get multiple Good Faith Estimates from multiple lenders… and don’t let them know that you are getting Good Faith Estimates from other loan officers!

Gilbert Arizona Mortgage Rates For February 26, 2009