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 Deep Throat Says to Refinance
By: Darin "Sid" Cameron, CRS
Wed, Jun 1st, 2005 11:49 pm

It’s not quite as earth shaking as this weeks news that Deep Throat has finally been revealed, but the continued downward spiral of mortgage rates the past few weeks could probably provide a much greater impact on your life if you’ve been thinking about refinancing or buying a home.

Yes, falling interest rates can hardly be called news anymore as they have declined seven of the past eight weeks and have spurred record home sales all around the country.

So, how low are rates right now? Generally, the folks who monitor rates are saying they're around a point lower than last year at this time (which we all thought was pretty low). But as every interest rate article I've read over the past year always points out, rates are expected to eventually start climbing by the end of 2005 (and the "experts" can only be wrong for so long you know).

As such if you've been thinking about refinancing or getting a home loan, do yourself a favor and consider getting the ball rolling while the rates are low. If you are refinancing, you may also want to think about refinancing your credit card debt to a lower (and potentially tax deductible) interest rate. The same might also apply to your car payment as well. The key is getting someone who is knowledgeable and trustworthy to help you determine what solution is right for you. As hard as it may be to believe, a good lender will want to make you happy in the hopes that you will work with them again or give them a referral- so be honest and open with them to see what they recommend doing.

This brings me to the topic of internet lenders. There are a lot of place out there you can get a loan from on-line and I’m sure many of them are good. However, I personally (and this is just my opinion) don't see a huge difference between the programs internet and out-of-state lenders are giving in comparison to what the local lenders are offering. Truth is, rates tend to be higher on the coasts, where many of the internet companies are located, than here in the Midwest.

The one thing to realize when working with any lender is that it's easy for them to give you a low rate when there are high processing fees, or low processing fees when the rate is high- i.e. a lot of companies play a shell game with financing, so make sure to read the fine print and know all your costs. Also, I strongly encourage you to shop around. Talk to three lenders- it’s a nice number. If someone is offering “too good to be true” programs, get things in writing. My experience is that the guy who “guarantees” you a low rate before he’s even runs your credit score is more than likely trying to “reel you in” and will make up for the low rate with processing fees. (At this time I should also point out that I’ve seen clients who have hurt themselves by talking to too many lenders. Be careful about having your credit score pulled by dozens of lenders because it can get your credit score lowered).

But back to the local guys… I personally hate working with out-of-town lenders. Why? Because things go wrong- that’s life. Imagine showing up to a Friday home closing with movers lined up to move you that weekend only to find out documents that were suppose to be Fed Ex’ed by the out-of-town lender didn’t make it off their receptionist’s desk the night before. When that happens, you don’t have a home to move into until Monday. Period. (fyi, faxing or e-mailing isn’t an option with legal documents). With a local lender, emergency documents can be couriered the same day- or for that matter, you can drive over yourself and get them. As my husband says, “if things go wrong, it’s good to be able to drive across town and wrap your fingers around someone’s neck!”

So, if you want my recommendations, I have multiple local lenders I work with. All have their necks located here in the St Louis area. If you would like to give one of them a call to see what they can do for you, contact me.

[ Next Article: The Safety of Your Home when You Open it Up to Buyers (Part 1) ]
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Darin "Sid" Cameron spent 15 years working in the technology industry which in 1998 relocated him to St. Louis. In 2004 he took over web development tasks for Kimberly's real estate team and later became the full-time Marketing and Operations Director in 2005. In 2011 Sid launched two brokerages, The Realty Store, Inc. and Realty Referral Partners, Inc, while continuing to perform marketing and operations for Kimberly's team. Sid holds a real estate broker's license in Missouri, CRS certification and was the first CyberStar in the St. Louis area.
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