What to look out for when Shopping for VA Mortgage Rates
When shopping for VA rates, there are several things to watch out for when getting quotes. Many factors are involved in determining what rate you get. The main criteria is the market. This is inevitable. There will be market changes that will affect the rates. So there’s no point worrying about what can’t be controlled. What you can control is who you select and what criteria you should consider when decided what lender to use.
What are the Costs?
Anytime you get a rate quote, “What are your costs?” should always be the first question you ask. However, there are many costs involved in getting you a mortgage. The ones you should be most concerned about are the ones the lender is charging. These have the greatest impact on your rate and can really skew the results for you tremendously if you aren’t careful.
First, are there origination fees involved? These are fees most lenders charge as a way of doing business. VA allows lenders to charge 1% origination fee and most take advantage of it. So if you were needing a $300,000 loan, you would have to pay that broker $3,000 to originate that loan. Their rates would be figured with that charge included. If it is not the actual “origination fee” there could be other
Next, do you have to pay discount points “points” to get lower VA rates? This is a way to buy the rate down. Basically, you pay a one time charge upfront. This charge is equal to a set percentage of the loan loan amount. In doing so, you get a lower rate and lower mortgage payments on your loan. This could end up being a substantial savings depending on how many points you pay and how much it saves you. In most cases, VA loans are already somewhat discounted. So the need for this may not be there.
Where are you getting your VA Rate Quotes?
The first and one of the most important factors when shopping for VA rates is “Who is providing the VA rates you’re getting quoted?” Is it a broker getting their rates from a rate sheet that may or may not be updated? You want today’s CURRENT VA mortgage rates, not rates from two hours ago. Also, if it’s a broker, more than likely, they’re not doing enough volume to offer unpaid discounts on your rate. So really pay close attention to costs at that point. See “What are the Costs” below for more information.
If it’s a bank they’ll have up-to-the-minute VA rates updated as the market changes and you’ll be able to get lower rates if they are a Federal bank doing business in 50 states. In most cases you can’t just find a Federal bank locally that does VA loans where you might find a broker. Your best bet to get the best deal is to get your VA loan online where you have more access to Federal Banks nationwide.
What about the Loan Officer? Is the VA Loan Officer giving you the best possible rate quote? Will they honor that quote? Generally, if you’re working with a bank, you’re fine. Both bank Loan Officers and Loan Officers that work at broker shops have to pass Federal licensing requirements. Bank Loan Officers however, can’t go to another bank and start originating without having to pass the licensing requirements again. Plus, unlike brokers, banks are regulated by federal agencies. Because of this, they monitored more heavily by these federal regulatory agencies than brokers. So you’re pretty much guaranteed that the VA loan rates quoted will be honored as long as you lock in the quoted rate before the market affects it. In either case, you want to be sure you trust your Loan Consultant. So before you apply for a VA loan, regardless of how great the rate they are quoting, Google them. It doesn’t hurt. Sometimes you might find out they aren’t as honest as they seem.
Is there a lender credit?
There are significant profits in VA loans and lenders can pass some of those profits onto the veteran by paying all or part of their settlement charges. This is extremely beneficial as it saves the homeowner’s equity in the case of refinances and shortens the time to recoup costs. In the case of purchasing a new home with your VA loan, it will save you thousands off the price of the home when negotiating costs with the seller, or the more obvious, saving you precious money at closing.
GET THE LOWEST VA RATES WITH NO HASSLES OR FEES
Now your shopping for VA rates has been made easier for you. You can get today’s lowest VA mortgage rates from a lender that charges zero in origination fees and not worry about dozens of harassing calls from salespeople. Check back anytime to get up-to-the-minute VA rates. When you’re ready, submit your request and within minutes, you’ll get today’s lowest VA rates. There’s no obligation and no charge.