Tulsa Mortgage : Podcast 16 – Part 1
Steve Carrington: This is stevecarrington.com and this is Steven Tyler Show Episode 16.
Welcome to Steve n Tyler Show with stevecarrington.com and Tyler Wiper Tulsa Mortgage.
Steve: Who negotiated the contract for you?
Tyler: A realtor. That was pretty smart. Good for you.
They’re talking about everything you need to know about mortgages home loans and more. Nobody knows mortgages like these two. Get ready because here’s Steve and Tyler.
Steve: Tyler, what’s the week been like?
Tyler: It has been busy.
Steve: Oh my goodness.
Tyler: But it’s also been busy in Colorado Tulsa Mortgage.
Steve: Oh yeah we have– guys I don’t know if you know but we do mortgage in Colorado. We do Colorado mortgage, Colorado Springs mortgage.
Tyler: Columbia mortgage.
Steve: Tulsa mortgage, Tulsa mortgages.
Tyler: Alamosa mortgage.
Steve: We got Farmington mortgage now. Farmington New Mexico mortgage.
Tulsa Mortgage STEVE: Pueblo Colorado mortgage. Pueblo mortgage. We got Richloam and Chris storm mortgage just hopped in Alan Peebles Mike Raddock okay people and what are we talking about today Tyler? We’ve got some hot topics. I think the one that we’re going to start with today is going to be; can I trust the interest rates in the newspaper? So if you’re a lender this is kind of a funny thing that happens is people call and they say, “We saw online or in the paper that rates rate 0.000002. That’s what it sounds like in my head because they’re like, I saw a 2%, you could get 2%. But it’s just not true.
TYLER: No I mean like we could have a 0% interest tomorrow. Every day would just be tomorrow.
Steve: There you go. I’ve seen there’s some restaurant–there’s a place in Tulsa that has its sign on the wall it says free beer tomorrow. It’ll be like that. So we’ll put up a sign that says 0% interest tomorrow. We should put that on the big sign outside. 0% interest tomorrow. So can I trust the interest rates in the newspaper? Here’s the deal. Everybody probably works in a professional industry or a lot of people do just like we do and being in the industry you probably find out things that happen before other people do.
Maybe even before the news reports it. So it’s the same thing with interest rates. They do a– they call it a Freddie Mac’s survey so they do a survey based on loan applications and loan locks and loan closings and the data that they get is usually– they put it out on a Thursday from the information that was collected and submitted the Friday before but it’s from data from the week before that or even the week before that.
So the interest rate in the newspaper remember how they have to print the newspaper and they have to get the data from somewhere. So it is not necessarily accurate because interest rates move like the–hey let me ask you this, this is a good question Tyler, Do you think that the price for Apple stock would be accurate in the newspaper tomorrow Tulsa Mortgage?
Tyler: No not at all.
Steve: Like what if I picked up the newspaper 4 P.M?
Tyler: No, not even close.
Steve: Because what? The markets move. It’s just the same as with interest rates. So that’s a good guide for you to be able to see what the average rate has been so that you can get a good barometer so to speak of where rates are but it’s definitely not going to be something that you’re going to trust you want to talk to a good lender, a good Tulsa mortgage lender and they can advise you of what rates are rather than you looking online. Somebody asked the question a minute ago so we can hit on that Tyler. So Zach called in and said, “So explain to me how I have the same interest rate with two different lenders on their offer? But one of them has a higher A.P.R?” You said you can answer that in one sentence Tyler it’s not putting you on the spot.
Tyler: One of them is just charging more money Tulsa Mortgage.
Steve: More money? What does that mean? Let’s get Tyler on the screen here.
Tyler: Hi, they could be charging discount points to get that rate so they may have the same rate but with one lender it may cost more to get that rate through the discount point. So you’re going to see higher A.P.R.
Steve: What is the A.P.R. does anyone know? Any viewers out there want to tell me what A.P.R. is? Annual percentage rate, annual percentage rate. So the reason they track your A.P.R. is for that reason and so don’t be fooled by a low rate with a high A.P.R. because that typically means that you’re paying a big chunk of money to get that rate. So let me give you an example. I might be able to offer someone an interest rate that does not come with any discount points, it doesn’t come with any loan cost other than your customer stuff underwriting processing that kind of thing Tulsa Mortgage.
So if somebody says [unintelligible 00:05:12]. Good one Rob but I’m not going to say that one before our guest. So he said what A.P.R- I’ll share with you later Tyler -so I might be able to offer the same interest rate as another lender. But because of the way that my profit’s set up as a lender. I would charge you say 2% percent of your loan amount just to get you the same rate that another guy might charge you just customary fees underwriting processing doc prep that kind of thing.
So that’s just what you want to be careful of. You can typically figure that out pretty quickly because if you look at your A.P.R. and your interest rate is for example ten and a half percent which it wouldn’t be but that’s here interest it was ten and a half percent of your A.P.R. was 14% then that should tell you that you’re paying some cost to get to that interest rate. Right. Tyler.
Tyler: Yap. What is that?
Steve I don’t know, I think I hit a boink sound.
Tyler: That was fun never heard that one yet.
Steve: I know where did it come from?
Tyler: I have no idea.
Steve: We heard crazy noises coming so that next question was and so thank you Zack for submitting that. But the next question is going to be, why are some lenders rates lower than everyone else? Why Tyler? Why are– what about those online rates?
Tyler: They could just be they’re out to get your rates really.
Steve: The teaser.
Tyler: The teaser rate. If you have this, if you’ve done that if you hop on one leg.
Steve: That’s right, that’s right. So if you have an 800 credit score and a 250,000 loan amount and you live in this sub-code and you have brown hair and you drive a Honda Civic then you can get that rate. So when you set the parameters that are that difficult for people to meet then that could be– so that might be an answer as to why some places have lower rates and the other thing is they might advertise a lower rate but they might advertise it at a higher cost.
I can give somebody a pretty low rate if they want to write a big check and that’s what it comes down to. How big a check do you want to write? I had a couple back in the first time homebuyer tax credit days you were around then right?
Tyler: I came in right after that.
Steve: So back in the day the first time homebuyer tax credit they got 7500 and then they increased it to 8000 and basically when you bought a house you got a tax rebate when you filed your taxes of $8000. So I had a couple that said, “We just want to apply that 8000 to a discount point so we can get a lower rate. Well they did. I tried to convince them otherwise. But they wanted to. So they paid 8000 dollars and it took their interest rate down by about a half a point, it’s saved them about 40 bucks a month I think.
Tulsa Mortgage Three years after they called me because they were upgrading to a new house wasted. So do that math eight let’s say it’s 50 because that’s easy 8000 divided by 50 dollars. I mean 8000 divided by $100 would be 80 months and 80 months would be 12 times 5 of 60 72. You’re looking at like seven years just for them to break even maybe eight years just for them to even just break even on that and then they moved in three so they just completely wasted their discount points that they paid. So don’t be fooled by someone who’s going to tell you that you can just get a lower interest rate and you’re looking online. Did I leave anything out there Tyler?