Beware of 'Bait and Switch'
Be cautious with GFE's (Good Faith Estimates) handed out by banks, loan officers, and other lenders. Some are written in "less than" Good Faith.
Borrowing money to buy a home or refinancing a home involves fees. There is a surprising difference in fees between various lenders. To quickly try to win your business, some lenders will present you attractive GFE's, with very low fees. But weeks later, when you're approaching closing time, they pull the "bait and switch," sneaking in hidden fees and extras. By then of course, you've invested lots of time and energy into the process.
Based on two drastically different experiences I've been through in the past 4 years, I've learned there are at least a few ways to increase your chances of finding a reputable lender from the get-go.
Three years ago when I sought a home loan, I went to the internet and typed in "compare lenders" into Google. Among the results, I clicked a large, well-known lender we've all seen on TV, which took me to a page where I entered my loan requirements, etc. Within an hour, I was besieged with phone calls and emails, and I went with a lender who emailed me a very attractive-looking (low) GFE. Long-story-short, it kept coming back to me with more and more lines and fees on it. A month later (close to closing time) my original GFE was inflated with 70% more "fees." It was a nightmare.
Six months ago, however, when I refinanced my home, I tightened down my search criteria, entering "compare lenders, IDAHO," which brought me to a similar form as before (at compareidaholenders.com), but the lenders presented were all local. I ended up meeting face to face with one who lived in my town, whose GFE appeared complete, but reasonable. She even told me the GFE is an estimate and it may change, but only slightly. About three weeks later I closed on the refinance, and the GFE was $12 off -- in my favor!
So, lessoned learned:
1. Get at least 3 GFE's, from various lenders.
2. Remember what dad always said: "If it sounds to good to be true, it probably is."
3. Go local.
About the Author/Author Bio
By the way, for any Idahoans out there, the place I went to find the good GFE was www.compareidaholenders.com
By Expert Author: Michael Little
Article Source: http://www.articlesphere.com/
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