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Casual Articles - How Does a Loan Officer Get Paid and What are Points
First things First. Why would you like to have Windows Based Hosting when there are Linux packages for cheaper rates ? The answer is – it depends on what application you are looking to use for your hosting. Consider the tools and scripting languages you plan to use – if you use PHP, Perl or MySQL, Linux is the way forward. If apps are Microsoft-specific, then Windows is what you need. Clear…?Now let’s proceed with the essential ingredients of any Windows Hosting Plan.1. ASP Support – The clear reason why you chose a windows plan is to use Microsoft Specific Languages. Active Server Pages, Microsoft's technology to enables HTML pages to be dynamic and interactive by embedding scripts. Check all the windows hosting plans and make sure, the host doesn’t charge for this extra.2. .NET Support – ASP.net is the next generation of Microsoft's Active Server Page (ASP), a feature of their Internet Information Server (IIS). ASP.net is different from ASP in two major ways: it supports code written in compiled languages like C++, Visual Basic, and Perl, and, it features server controls that can separate the code from the content, allowing WYSIWYG editing of pages. Most of the hosts give this feature free of charge while few charg
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this
One thing you have to say about the Internet: It's where creativity and ambition can truly turn anyone into a millionaire.You’ve no doubt heard the stories and maybe even seen some of the advertising e-mail and Web sites offering so-called wealth building systems. Certainly, a lot of the hard sell is just hype. But a surprisingly high percentage of those claims are true. For Online Internet marketers are continuing to rake in fortunes and there's always room for one more.Maybe that could be you.That said, if you are considering a change in careers and looking for information on how to start an Internet business, you need to know that despite what the hyper-excited online sales pitches say, there is no get-rich-quick system.Let me phrase that differently: If you want to make it in Internet marketing, you are going to have to work as hard or harder at it than anything you've ever done before. And you are going to have to be patient. It takes months to even start a trickle of income, a year or more before you see your efforts really start to pay off.Let me be really blunt here. You are going to have to work hard at this. There truly is no such thing as a free lunch.No matter how good the system and ho
The mortgage industry has become extremely competitive in recent years, with literally tens of thousands of licensed brokers in California alone. How did it get this way? In recent years with interest rates at record lows it was an easy way for even inexperienced people to make a ton of money with little training, and no experience. The calls to refinance came pouring in. If you could answer the phone you could make good money in the real estate lending business.
I’m not trying to slander real estate professionals. Most are very good at what they do. It is simply that in any field as over crowded as this one has become you will find those who will bend the truth, who will forget to mention certain things, prevaricate or outright lie to get your business.
Let’s set the record straight, shall we? Nobody does this for free. I myself have seven children and a beautiful wife to support. I need to get paid. For my pay I provide a quality service. Most of us in this industry work on commission; the funny thing is I get to set my own commission on each and every loan, by charging ‘points.’
You may have heard the term ‘points.’ What is a point? Simply this, a point is one percent of the loan amount. It’s called origination, or points. If I charge 3 three points on a $100,000 loan it equals $3000. I get to decide how many points I’m going to charge. The law in most states limits the number of points I can charge. To go beyond that is usury, and simply not allowed. That limit is as high as 6% in California or even higher in some states. I myself very seldom charge more than three points. I also seldom charge less than three points. The number of points being charged is disclosed along with all other closing costs on the Good Faith Estimate or GFE.
A word on GFEs, they are an estimate, and some less scrupulous lenders really make the most of that fact. When I do one I try to be as close to actual costs as possible or even a little high. Sometimes things as simple as the day the loan closes or the amount a notary will charge can affect the actual amounts. On every loan I do I build in a pad of $250. The reason is simple. I estimate everything on the high side of reasonable and put in the pad, because I’ve never had a client complain that they got $31,000 at closing instead of the $30,000 they asked for. Now imagine you needed to refinance and take $30,000 cash out, and I delivered on $28,712 instead of the $30,000 you needed.
Make sure your loan professional discloses ALL fees and not just his own. Often they will show you only the fees that broker is charging and not put in the title insurance fee, or the escrow fee, or any other third party fees. Ask, “Are these all the fees I’ll pay?” If the answer is “No,” run don’t walk to an honest loan officer.
Typically the only part the loan officer gets paid on is the origination. Of that they will usually get a split with the broker. I’ve seen splits that range from a flat $500, to anything from 25% to 85%. The broker in most places makes their money from the other fees. Application fees, processing fees, admin fees, tax service fee, underwriting fee, wire transfer fee, and more. Some are legitimate some are merely padding the price of the loan.
Points are not the only way we get paid. We also can get a rebate from the lender. Let’s say I went to a lender with your file and they quote me an interest rate of 6.5%. I turn around and tell you I can get you 7%. For this I receive a one-point rebate from the lender. While at first glance this may seem sneaky and dishonest, remember I’m getting a wholesale rate. If you went there direct you would not receive the 6.5% rate. They offer it to me with room for me to make a profit. Some lenders will limit how much I can raise the rate from what they offer me.
The base rate that they offer is called ‘par.’ Those of you who are golfers will understand the term. It means basically the base rate. Even. No adjustment up or down. That rate can go up for a rebate, or it can go down, IF you buy it down. Often when doing this you are only buying it down for a specific period so beware.
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this t
Financial constraints often are huge impediments in constructing a home for your self. But a construction loan comes handy for easy construction of home. Construction loan is designed especially for providing finance in a hurdle free manner and therefore many advantages are attached in the loan for the borrower.One advantage of construction loan is that the borrower pays only interest during construction period. He pays principal amount after the construction is fully completed. The borrower takes certificate of occupancy and then only the construction is taken as completed. The interest rate on construction loan depends on the schedule of construction. Lenders will charge interest rate as per stages of construction. The loan amount depends on the equity in the land on which the home is to be constructed. The loan amount can vary lender to lender. It all depends on how much of the project cost a lender is willing to offer as construction loan.Another point to be noted is that construction loan is a short term loan. As soon as you complete the construction and receive occupancy certificate you pay off the loan. It does not take much time to construct a home these days. So usually construction loan is given for 6 months to a ye
You may have heard the term ‘points.’ What is a point? Simply this, a point is one percent of the loan amount. It’s called origination, or points. If I charge 3 three points on a $100,000 loan it equals $3000. I get to decide how many points I’m going to charge. The law in most states limits the number of points I can charge. To go beyond that is usury, and simply not allowed. That limit is as high as 6% in California or even higher in some states. I myself very seldom charge more than three points. I also seldom charge less than three points. The number of points being charged is disclosed along with all other closing costs on the Good Faith Estimate or GFE.
A word on GFEs, they are an estimate, and some less scrupulous lenders really make the most of that fact. When I do one I try to be as close to actual costs as possible or even a little high. Sometimes things as simple as the day the loan closes or the amount a notary will charge can affect the actual amounts. On every loan I do I build in a pad of $250. The reason is simple. I estimate everything on the high side of reasonable and put in the pad, because I’ve never had a client complain that they got $31,000 at closing instead of the $30,000 they asked for. Now imagine you needed to refinance and take $30,000 cash out, and I delivered on $28,712 instead of the $30,000 you needed.
Make sure your loan professional discloses ALL fees and not just his own. Often they will show you only the fees that broker is charging and not put in the title insurance fee, or the escrow fee, or any other third party fees. Ask, “Are these all the fees I’ll pay?” If the answer is “No,” run don’t walk to an honest loan officer.
Typically the only part the loan officer gets paid on is the origination. Of that they will usually get a split with the broker. I’ve seen splits that range from a flat $500, to anything from 25% to 85%. The broker in most places makes their money from the other fees. Application fees, processing fees, admin fees, tax service fee, underwriting fee, wire transfer fee, and more. Some are legitimate some are merely padding the price of the loan.
Points are not the only way we get paid. We also can get a rebate from the lender. Let’s say I went to a lender with your file and they quote me an interest rate of 6.5%. I turn around and tell you I can get you 7%. For this I receive a one-point rebate from the lender. While at first glance this may seem sneaky and dishonest, remember I’m getting a wholesale rate. If you went there direct you would not receive the 6.5% rate. They offer it to me with room for me to make a profit. Some lenders will limit how much I can raise the rate from what they offer me.
The base rate that they offer is called ‘par.’ Those of you who are golfers will understand the term. It means basically the base rate. Even. No adjustment up or down. That rate can go up for a rebate, or it can go down, IF you buy it down. Often when doing this you are only buying it down for a specific period so beware.
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this
Payday loans in one hour offer instant cash. Online payday loan companies can process your application in minutes. Then they will contact you to verify your information. In one hour you can see your money wired into your account. Fastest of cash advances, one hour payday loans can help you in a pinch.Speedy ApplicationOne hour payday loans have the typical cash advance application. Lenders request your name, age, address, and source of income. You will also need to provide your checking account information so they can transfer your funds and withdraw your payment. Some lenders also offer transfers to a third party through Western Union.Once your application has been submitted, you will hear from your lender in minutes. They will request that you verify your information. This may mean that they call you at the number you provided. Or they may send you an email with a password and a site to check into. You may need to fax in some documents in some cases.Cash In An HourAfter verification, your money is wired to your account within the hour. With many of these companies, they will process your request any time. So even at 1 am, you can submit your application and have your cash by 2 am.
Make sure your loan professional discloses ALL fees and not just his own. Often they will show you only the fees that broker is charging and not put in the title insurance fee, or the escrow fee, or any other third party fees. Ask, “Are these all the fees I’ll pay?” If the answer is “No,” run don’t walk to an honest loan officer.
Typically the only part the loan officer gets paid on is the origination. Of that they will usually get a split with the broker. I’ve seen splits that range from a flat $500, to anything from 25% to 85%. The broker in most places makes their money from the other fees. Application fees, processing fees, admin fees, tax service fee, underwriting fee, wire transfer fee, and more. Some are legitimate some are merely padding the price of the loan.
Points are not the only way we get paid. We also can get a rebate from the lender. Let’s say I went to a lender with your file and they quote me an interest rate of 6.5%. I turn around and tell you I can get you 7%. For this I receive a one-point rebate from the lender. While at first glance this may seem sneaky and dishonest, remember I’m getting a wholesale rate. If you went there direct you would not receive the 6.5% rate. They offer it to me with room for me to make a profit. Some lenders will limit how much I can raise the rate from what they offer me.
The base rate that they offer is called ‘par.’ Those of you who are golfers will understand the term. It means basically the base rate. Even. No adjustment up or down. That rate can go up for a rebate, or it can go down, IF you buy it down. Often when doing this you are only buying it down for a specific period so beware.
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this
I heard a friend saying that he no more feared debts because of the ease with which he can repay them through a debt consolidation loan. Is it so easy to counter debts through a debt consolidation loan? Are there any issues attached to this method of debt settlement that needs appropriate consideration? The following article is a guide to debt consolidation loans in the UK and discusses important issues that linger in the mind of borrowers related to it.It is really easy to avail of debt consolidation loans. Almost every lender in the UK would willingly offer you the necessary finance to eliminate your debts. This is even when there is no collateral to back the loan amount. Gone are the days when the persons in debts were considered pariah. Debt is an accepted fact, which with the present materialistic lifestyle crops up because of increasing expenses. Thus, debtors are able to get finance easily to settle their debts.However, there is a limit to the times that one can push his finances to the edges. Accumulating a huge mound of debts every time to be cleared through a debt consolidation loan will be unwise. When th
Points are not the only way we get paid. We also can get a rebate from the lender. Let’s say I went to a lender with your file and they quote me an interest rate of 6.5%. I turn around and tell you I can get you 7%. For this I receive a one-point rebate from the lender. While at first glance this may seem sneaky and dishonest, remember I’m getting a wholesale rate. If you went there direct you would not receive the 6.5% rate. They offer it to me with room for me to make a profit. Some lenders will limit how much I can raise the rate from what they offer me.
The base rate that they offer is called ‘par.’ Those of you who are golfers will understand the term. It means basically the base rate. Even. No adjustment up or down. That rate can go up for a rebate, or it can go down, IF you buy it down. Often when doing this you are only buying it down for a specific period so beware.
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this
Private or home tutorship is common nowadays all over the world. Over in Malaysia however, the idea has yet to reach their full potential since most parents are more interested in sending their kids to tuition centers. Hence it is not surprising to see that Malaysians that has teaching experiences and credentials especially those working in public schools and universities took the opportunity to make some extra money by working part time in tuition centers.As time goes by, more and more Malaysian parents are beginning to realize that hiring private or home tutors to take care of their children’s education would be more beneficial. By hiring private or home tutors, parents could easily monitor their children’s learning progress. What is most important to most parents is that they do not have to worry that their children would befriend bad companies outside. There’s nothing wrong with tuition centers, it is just that it would not be easy for parents to monitor their children’s social behaving while they were out learning. Malaysian parents have always been concerned about the moral upbringing of their children and this has triggered nationwide demands for the provision of more home private tuitions.This increasing demand of hom
These are the biggest two ways to get paid but there are others. Let’s say you took out a ‘Pay-Option-Arm’ or ‘Pick-A-Pay’ type loan. This loan comes with the opportunity to choose one of four payment options each and every month for five years. You might choose to make a 15-year, or 30 year fully amortized payment. You could also choose interest only, or even a minimum payment based on 1% interest, with the rest of the true rate tacked onto the backside of your loan. Fully discussing this loan is a subject for another article, but suffice it to say this loan can be perfect or a disaster and you’d better understand the ups and the downs of it from the beginning.
On this type of loan all kinds of promises are made. “I can do it for Zero points! One point! 1.5 points!” Whatever.
The reason is the high backend rebate. It may not be charged to you directly but your still paying for it.
The rebates on this can be as high as 3.4 points. Selling you on a three-year prepayment penalty does that. It also means a higher fully indexed interest rate. If you’re getting into this loan for the 1% payment only, then maybe you don’t care. If your real estate market is going up faster than the loan amount is climbing, maybe you don’t care. If you are getting into this type of loan, make sure you’re asking about the rebate. If you are being charged points up front and the loan officer is getting a high backend rebate he’s ripping you off. One or the other, or a reasonable combination of both. One point up front combined with a 2.5-point rebate is reasonable. It makes the total commission 3.5 points. Two and a half up front and 1.75, for a total of 4.25 is a little high, in most cases. Sometimes the amount of work involved justifies the extra pay. As a general rule I think three points is fair to all concerned.
How do you know what your loan officer is making on the back? It is disclosed, but you need to know what you are looking at. It’s called ‘yield spread premium’ or YSP. Be careful of this though. Just because you don’t see it does not mean it’s not there. When your loan officer is selling you a loan from his own company, he does not need to disclose the YSP. The YSP is what the ‘broker’ charges over what the lender offers. If dealing direct with the lender there is no YSP. Even if the loan officer can get you that 6.5% and sells you the 7% instead, because he woks for the lender there is no YSP. Ask if he is a broker or direct lender. As with almost anything either can be sold well.
If he’s a direct lender he’ll say things like “Our money, our rules.” Or “we can control it all because we don’t have to play by the other guys rules.”
If he’s a broker he’ll say “I deal with 30, 50, 200 lenders so I’ll get you the best deal.”
Reality is that while where I work we’re approved with over 50 different lenders I’ll price a loan with no more than half a dozen and usually I know before I begin who will get the deal. Each loan is different and one of the reasons I get paid is to know who does this kind of loan. Is it ‘A’ paper or sub-prime? Is it a single-family residence, or a condo? Is it investment property of primary residence? Do we need to do a stated income loan or full doc?
I get paid for my expertise. I get paid because I not only take your loan to the guy with the best interest rate but also to the guy will get it done quickly and efficiently. If for example you were borrowing $200,000 at 7.25% your monthly payment would be $1364.35. What if you turned down the guy who told you he could get it at 7.5% even though you thought he was the more qualified? You’re chasing the rate. How much did that save you? At 7.5% that same $200,000 costs you $1398.61 per month. The difference is only $34.26 per month. Now let’s say you go with the cheaper guy. He came in cheapest because he was chasing your business. When you don’t know what you’re doing the only way to compete is to try to undercut the other guy on price.
For $34 a month you get a guy who maybe can’t even get it done. The lender has poor service so the loan doesn’t close on time and someone else buys your dream house.
For $34 a month I’ll take your loan to someone who will make it happen smoothly and quickly.
As with anything you get what you pay for. Quality service costs a little more. Beware of the guys who are either too cheap or too costly. Either is a sign to beware of.
Too cheap and they are chasing your business because they really need it. Maybe they are very good and just really want to give you, a total stranger the deal of the century. Possibly they are that good and just in a
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