Shopping for a lender? HERE'S THE INSIDE SCOOP ON HOW TO DO IT RIGHT! First: make sure you are working with an experienced, professional loan officer. The large financial transactions of your life are far too important to place into the hands of someone who is not capable of advising you properly and troubleshooting the issues that may arise along the way. But how can you tell? Here are FOUR SIMPLE QUESTIONS YOUR LENDER ABSOLUTELY MUST BE ABLE TO ANSWER CORRECTLY. IF THEY DO NOT KNOW THE ANSWERS… RUN… DON'T WALK… RUN… TO A LENDER THAT DOES! 1) (The only correct answer is Mortgage Backed Securities or Mortgage Bonds, NOT the 10-year Treasury Note. While the 10-year Treasury Note sometimes trends in the same direction as Mortgage Bonds, it is not unusual to see them move in completely opposite directions. DO NOT work with a lender who has their eyes on the wrong indicators.) 2) (A professional lender will have this at their fingertips. For an up-to-date calendar of weekly economic reports and events that may cause rates to fluctuate, call Sally Kraft at (925) 227-8514. 3) (When the Fed makes a move, they are changing a rate called the "Fed Funds Rate". This is a very short-term rate that impacts credit cards, credit lines including home equity lines of credit,, auto loans and the like. Mortgage rates can actually move in the opposite direction as the Fed change, due to the dynamics within the financial markets. 4) (If a lender cannot explain how Mortgage Bonds and interest rates are moving at the present time, as well as what is coming up in the near future, you are talking with someone who is still reading last week's newspaper, and probably not a professional with whom to entrust your real estate financing.) Be smart... Ask questions… Get answers!
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