When comparing what you think are apples to apples, how can you tell if one of them is actually an orange?

The truth is, unless you’reexperienced in analyzing and comparing GFE’s(Good Faith Estimates) it’s almost impossible to tell exactly what will be the differences in your long and short-term financial picture.  A scenario that at first glance looks more expensive than another may be more beneficial over a ten-year term.  It’s important to take into consideration our client’s entire financial picture and goals both today and tomorrowbefore we offer a proposal.  Too many in the mortgage profession shout “LOW RATES!” as their sole platform – without ever considering what the borrower’s true needsare. 

One way to help our clients actually determine just what those needs are, is by performing a TRUE COST ANALYSIS.  Only about 10% of the nation’s loan originators possess the very sophisticated software system that compares multiple possibilitiesand breaks down the financial pros and cons of eachin an easy-to-understand report.

Did someone else give you a quote and a GFE?  Make us your “second set of eyes” and we’ll explain what it really means to you.  If their proposal is best for you, we’ll tell you just that.  And if it’s not, we’ll show you the math that explains why.

The following is an example of such a report.  This represents the purchase of a $275,000 home with the comparison between: 1) A 30-yr fixed loan for 80% of the purchase combined with a "piggyback" 2nd (yes, they still exist) for 10% of the price and the buyer making a 10% cash downpayment. 

2) A 5-yr ARM for 80% of the purchase and the buyer making a 20% cash downpayment.

3) An FHA, 30-yr fixed loan for 97% of the purchase price and making a 3% cash downpayment.  This scenario includes Mortgage Insurance reserves and monthly MI payments.

Clearly these are very different scenarios but these were actual scenarios requested by a client.  We then were able to show what the total equity gains might be in 5, 10, 20 and 30 years for each scenario, assuming that the money that was saved with the smaller downpayments was deposited into a conservative, interest-bearing account and the differential between the highest monthly payment and the two lower payments were also invested into that account each month. 

We’re happy to do one for you, free of charge or obligation.