Why So Many Fees? The True Story Of Why Your Eugene Oregon Mortgage Loans Seem To Cost Too Much
Eugene Oregon Mortgage Loans? Hoping to refinance your Eugene Oregon home? A great way to find a Mortgage Loan Officer in Eugene Oregon is to use the internet! Simply type in “Mortgage Loans,Eugene Oregon”, and take a look at the loan officers available in Eugene. Then, just make a few phone calls until you find that Mortgage Loan Officer who will work to find you a Mortgage Loan that you can be confident is the right choice for your needs.
The common opinion seems to be that those who work on a commission are shifty, dishonest people. They are often portrayed as money hungry, willing to use high pressure tactics, even outright lying to the customer in order to “close the deal” and make that money. However true this may be of SOME commission-based employees, there are many(such as Mortgage Loan Officers, who do not fit this stereotype.
For example, in the case of the Mortgage Loan Officer , this negative connotation of the commission worker as someone who is trying to take advantage of the situation to make more money becomes an issue which can affect the loan applicant’s loan officer relationship.
Once you have retained a loan officer, it’s time to apply for the loan. You will receive the necessary documents with the application in the mail, at which point you can finally get the ball rolling.
You and your loan officer are clear to embark on refinancing your home, as soon as she has completed two important tasks: pulling your credit score, and checking the paperwork to be sure that the information you’ve given is correct.
The Loan Processor will be the next person to look over your information, double checking it for accuracy and any possible errors made by the Mortgage Loan Officer. The LP then constructs a file and organizes all of your information into a single file. The LP also runs a pre-qualification to see if Fannie Mae, Freddie Mac, FHA, etc. will agree to the loan based off of your “non-verified” paperwork. In addition, the LP preps a disclosure packet for you to sign later, and contacts a local title company to open escrow.
When you come back to the office about 48 hours after you first apply, it will be to sign your disclosure packet. This will be when you find out how much you will owe in fees related to processing the loan.
This is where the that negative bias about commissioned employees comes into play, because the fees are many and varied and may seem like a shifty attempt to squeeze additional funds from your wallet as part of the process. There are title fees, lender fees, origination fees and appraisal costs, just to name a few.
“Why so much money?”, the client invariably asks, when presented with the “Good Faith Estimate”. Generally totaling about $10,000, the amount can seem excessive, but there are good reasons for this. Most clients simply do not realize how much effort it takes on the part on many paid employees to process the loan.
To illustrate this point, the following is a list of the people who are working to successfully complete your loan: Mortgage Loan Officer, Mortgage Loan Processor, Title Officer & Assistant, Escrow Officer & Assistant, Underwriter, Document Drawer, Funder and Appraiser. These people are all working for you and your loan over the next 4-6+ weeks. These are all needed services to complete the loan and these are all employees who must be paid for their work completed.
Another factor which drives up the price on this Good Faith Estimate is the need to pre-pay the property taxes and insurance reserves. For most people, their property taxes and insurance are lumped in with their principle and interest payment, which creates a reserve account which pays for these taxes and insurance when they are due. However, when you refinance, you must stock your reserve account in order to cover the payments which won’t be made on the new loan before your insurance and taxes are due. You will get your old reserve account back, but in the meantime you must pay to “restock” this account before you can get this money back again.
This is all handled over the period of a few weeks, and requires a lot of people and services to push your loan to completion. What some loan applicants may not know is how precarious this process is for those who are handling your loan. If things turn out well, the loan goes through successfully, you get the refinance you were hoping for, everyone gets paid for the job completed and everybody’s happy. But if your situation changes and you aren’t approved to refinance after all, then those commissioned officers and other employees who have spent many months working on your loan wind up with nothing. That’s right, they have essentially worked on this loan for free. This is a loss to the worker, but also to the companies who must pay for those other workers within the same company who are paid hourly.
To put it another way, knowing that their payment is contingent on the success of your loan, what sense does it make to raise a fuss over paying the necessary fees involved?
There seems to be a double-standard: People complain about the 2% pay cut that the commissioned Loan Officer asks for, whereas they think nothing of paying 6% to a real estate agent if they were helping them to buy or sell a home.
Would you work for free? Probably not, and it would be unfair to expect your Mortgage Officer to do so. Paying them 2% is not an unreasonable fee for the amount of time and hard work that they have put forth toward your success in getting a mortgage loan.
Looking to find the best deal on Mortgage Loans Eugene Oregon, then visit www.omtmortgage.com to find the best advice on Eugene Oregon Mortgage Loans for you.
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