I am applying for a $350Kloan with a 20% downpayment (30-year fixed conventional) as a "new" homeowner (haven't owned a home in the last 5 years) for a new construction to be completed this August. My credit is 795-815, according to three pulls from different credit agencies done by the lender. I have two options:
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a builder-recommended lender, FBC Mortgage (Florida), who will provide $5K toward closing costs, in addition a 6.49% interest rate on my pre-qualification document. The paperwork states that this loan "will be transferred to another servicer".
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my own bank (Chase), who will "try" to match the incentives, however the percentage I am being quoted at is 6.875% in my pre-qualification (although they have indicated 6.99% in the initial disclosures). I am a Private Client with a lot of cash at Chase, but it seems to not have affected the outcome. This loan will be serviced by Chase for the life of the loan.
Whom should I pick? Is there any benefit to picking Chase? One thing that stood out to me is that the Chase loan paperwork was completed with a lot of errors. FBC was spot on. I am still trying to get the paperwork corrected with Chase. My previous mortgage with Chase in 2016 overran the closing date by two weeks due to precisely these types of errors - I had to shell out about $4K for their mistakes that I've brought up and were never corrected and almost lost the house.
I am a little hesitant to go with FBC, as they may suddenly "hike" the rate prior to closing to something like 7%, despite the market dropping or staying the same - and then I'll be stuck. Plus, the loan will not be serviced by them.
Any advice will be greatly appreciated!
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source https://www.reddit.com/r/RealEstate/comments/1iizila/advice_on_picking_a_lender/
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