I’ve only had two mortgages in my life and they were both for small amounts of money and during pleasant financial times. Since the sub-prime market collapsed several months ago though, getting a loan has become much, much more difficult. My credit is great and I have a strong cash position, but even so, getting a jumbo loan is seemingly 10x more difficult than it has historically been.
Shopping for mortgages is not a pleasant process either. Most companies want you to give them all sorts of personal information before they even hint at what rates they can get you. Even places like Lending Tree that purport to streamline the process are little more than information-selling lead-generators that put your personal information in hands you may not be comfortable with.
One service that seems to stand above the rest, however, is the recently introduced Zillow Mortgage Marketplace. The great thing about Zillow is that you simply enter as much or as little info and you want, and mortgage brokers simply send you offers through the Zillow website. They don’t know your name, your contact info, or anything else you may not want them to know. They only know what you decide to tell them. In my case, income, net worth, desired loan style, and a few other things. Within an hour of filling in some info, I got ten mortgage offers via my Zillow inbox, at least a few of which would have been great to go forward with.
In the end, since I have such a small closing window (July 31st), I felt more comfortable going with a local institution who underwrote their own loans. I went with Wells Fargo and loan officer Steve Altchech, upon the personal recommendation of my real estate agent (UPDATE: 5/30/09: I no longer recommend Mr. Altchech). He got me the following terms, which are crazy-good in this tough market. Even my previous mortgage guy who wanted my business again said “Take it!”:
- 1st Mortgage: 5/1 ARM at 5.85%
- 2nd Mortgage: HELOC at 4.75%, indexed to prime minus .25%
- No points and no fees other than title, escrow, etc.
Once the mortgage market settles down again, I can think about refinancing to a fixed mortgage, but for now, I’ll take the cheap money.
All set to close on the 31st!