Lender vs Lender, what do I do?

Private Lending & Conventional Mortgage Advice
5yFollow

Lender vs Lender, what do I do?

Ryan Copeland
Rental Property Investor · Columbia, SC · Member since 2020 · 244 posts · 275 votes

So I am going through the lending process with another lender and we just got my rental appraised last week. Now Quicken, who has the current mortgage, has gotten the notice that I’m about to pay off the loan and then they call me offering me a deal. My current rate with the new lender is 3.875% for 30 years. Today, quicken offers me 2.99% for 30 years. I must admit the Quicken is giving a much better deal, but I don’t want to burn the bridge with the lender that I’m working with now. When I called Quicken back in early January they said that they weren’t doing a cash out refi‘s on rental properties, but the lender I’m working with now said he could and we moved forward.

Should I ditch the lender I’m working with for the better deal with Quicken? I don’t want to burn a bridge or ruin my name. I would like to work with the current lender in the future, but if I bail so far in the process I’m not sure if he would want to.

4Reply
130 views

Most Popular Reply

Michael Plante
Deland, FL · Member since 2017 · 2k+ posts · 1k+ votes
5y

Hi new lender 

out of the blue Quicken loans offered me 2.99 of you can beat that I’m in 

I don’t want to burn a bridge with you but I have to look at what I have been presented 
please let me know your thoughts 

Much appreciated 

11Reply
See this reply in the discussion

32 Replies

Jump to latestLatest
  • Ryan Copeland
    OP
    Rental Property Investor · Columbia, SC · Member since 2020 · 244 posts · 275 votes
    5y

    You're right @Chris Mason.  If you simply look at the interest rate, you will be amazed.  However if you break down all of the fees associated with the loan it doesn't make any sense at all.  Thank you for your contribution to this post.  You are absolutely right, BP is an amazing source of info with a fantastic community.  

    0Reply
  • David A Lisowski
    Rental Property Investor · Inlet Beach, FL · Member since 2018 · 199 posts · 111 votes
    5y

    @Ryan Copeland

    Quicken is charging you $3,295 for 2.375 in points... in other words, your rate is really 2.99+2.375 = 5.365%

    They are just having you buy a lower rate. This is available to all lenders. You can buy whatever rate you want. You could also ask to get a higher rate and get a lender credit instead.

    Of course, there are limits to fees, credits, etc.

    For example, the point charge from Quicken is already 2% of the loan costs. Once fees reach around 3%, the loan is no longer compliant with conventional guidelines. I say around 3% because not all fees count.

    My guess would be that Quicken would eventually be forced to change the rate since they are charging you so much for the points. Otherwise, they are paying, and Quicken doesn't seem like they are happy to pay fees on loan... just guessing.

    0Reply
  • Ryan Copeland
    OP
    Rental Property Investor · Columbia, SC · Member since 2020 · 244 posts · 275 votes
    5y

    @David A Lisowski I stayed with the lender I’m currently working with. The numbers from Quicken didn’t make sense.

    1Reply
  • Stephanie MedellinBusiness Member
    Mortgage Broker · CA · Member since 2014 · 1k+ posts · 642 votes
    5y

    @Ryan Copeland  You can always ask your current lender how much it would cost to buy down your rate, even if you're already locked.  You will get the pricing from the day you locked, but you do have the option to choose a higher or lower interest rate.

    Quicken does have a reputation for quoting low rates with high points, so you always want to find out the real cost behind the rate being offered.  

    [email protected]
    Stephanie Medellin, Loan Factory58 Reviews
    WebsiteView Page
    0Reply
  • Stephanie P.Pro Member
    Washington, DC Mortgage Lender/Broker · Member since 2016 · 4k+ posts · 2k+ votes
    5y
    Originally posted by @Ryan Copeland:

    So I am going through the lending process with another lender and we just got my rental appraised last week. Now Quicken, who has the current mortgage, has gotten the notice that I’m about to pay off the loan and then they call me offering me a deal. My current rate with the new lender is 3.875% for 30 years. Today, quicken offers me 2.99% for 30 years. I must admit the Quicken is giving a much better deal, but I don’t want to burn the bridge with the lender that I’m working with now. When I called Quicken back in early January they said that they weren’t doing a cash out refi‘s on rental properties, but the lender I’m working with now said he could and we moved forward.

    Should I ditch the lender I’m working with for the better deal with Quicken? I don’t want to burn a bridge or ruin my name. I would like to work with the current lender in the future, but if I bail so far in the process I’m not sure if he would want to.

    Congratulations on making the best move for you.  I saw the LE and agree, it's not the best loan for you.

    I tell people all the time, it's just a math problem.  Get all the information and work it out. The numbers won't lie.

    Stephanie

    1Reply
  • Ryan Copeland
    OP
    Rental Property Investor · Columbia, SC · Member since 2020 · 244 posts · 275 votes
    5y

    You're right @Stephanie P., the numbers don't lie and everything with a RE deal is a math problem.  The numbers have to work for the outcome you're trying to have.

    1Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free