I’m under contract to buy or build a home.  The closing is scheduled beyond the normal times to lock in on an Interest rate.  I’d like to select my lender now and begin the loan process.  The best way to do that is to call around and ask what each one is offering on a normal lock-in basis.  That gives me an indication of who will have the “best deal”.

This is the worst way to decide what lender you should select given this specific situation.  Lenders are just like any other business in that the product they are offering for sale is subject to price changes which are constantly being modifies by their suppliers.  By the time you get in a position to obtain (“lock-in”) for a specific rate and program you might find that particular lender is no longer offering the best rate.  Some lenders may even quote rates below the market because they know  you could not possible lock in to that rate.  It is not uncommon for a lender to be offering extremely competitive rates one day,  then for no apparent reason, this same lender may just arbitrarily decide to get completely out of their market by raising rates.  This happens all the time.  Lenders do this for a variety of business reasons which are behind the scope of the article.

 

The point is that you must be in a position to take advantage of whatever opportunities exist in terms of rates.  In addition to rates, you should also consider the opportunities created by the constant flow of new loan products.  Consumers benefit by the constant creation of new financial products.  An example, think of all the mutual funds looking for our investment dollars.  The mortgage business is similar.  There are new products created each week.  If you are not experienced in evaluating loan programs it can remind you of a Clint Eastwood movie...”The Good, The Bad, and The Ugly!”.  The reality is that many of these new programs have excellent benefits that can translate into significant dollar savings for you.  You should begin your loan process with a company and individual with the ability, knowledge, and expertise to locate a competitive rate and advise you on the most appropriate loan program to suit your specific needs.