I was trying to find a ongoing mortgage thread (similar to the CD thread) with recommendation of website/blogs, best loan deals found w/ loan amount and FICO but did not find one. It may be benefical to start one? (Penfed normally offers great deals, but they are currently pretty high)

With the prices leveling and starting to go down, and interest rates starting to rise, I am preparing to purchase real estate by trying to select the mortgage brokers to work with when I find the property to purchase. I have created a initial list of pre-screening ?'s to ask. I am listing them below and I am requesting the "wise ones" on the forum to review the questions and provide feedback on anything else I should ask. If you have recent positive or negative feedback on banks/mortage broker or a list of blogs/websites to monitor I would appreciate it (I do check bankrate.com).

I am planning to utilize a discount RE broker (provides Cash Back to buyer), but they require a pre-approval prior to scheduling a viewing. Are there any recommendation on mortgage brokers/banks to utilize for the pre-approval. I have excellent FICO score, and am planning to put down atleast 20% (to avoid the PMI) and am planning to purchase in NW suburbs of Chicago, IL.

While I am mainly looking at single family, I am also considering purchasing a residental owner rental property.

I am considering for estate planning/protection purchasing the property in:
- S-Corp/LLC
- IL Land Trust or
- Living Trust.

Does anyone have advise on which of the above would be better. I know living trust and IL land trust would offer minimal asset protect vs purchasing the property in S-Corp/LLC, but the interest rates and loan qualification requirements may be different?

Following are the list of pre-screening ?'s.

Questions for Mortgage Broker:

• What services are you offering and what sets you apart from other mortgage brokers and lenders?

• Do you offer best loan guarantee?

• How will you insure that I will be reasonably protected and informed throughout the loan process? How will you ensure the loan closes on time and smoothly?

• In addition to providing you, with the required documentation I am suppose to provide, what steps should I take to ensure the loan and closing occurs smoothly.

• How much time do you need to fund? Do you offer closing time guarantee?

• How long can the rate be floated?

• Do you offer lock-in rate in writing and how quickly can you provide the statement?

• What is the duration for loan rate locks? If the interest rate goes lower do you offer free re-lock? What happens if the loan cannot close within the lock period (lender issues, etc.)? Will there be any charges if additional lock-in is required? What happens if the closing is delayed or cancelled?

• What rate will be charge if the lock-in expires before settlement? If settlement does not occur within the lock-in period, will the fees be refunded (i.e. lock-in/application, etc)?

• How can you assure me that I can avoid paying "junk fees" and unnecessary add-on loan expenses?

• Will you be offering me the best loan possible for me (interest rate, APR, fees) and the info on all the loans which I qualify for, given my loan requirements?

• How quickly will you be able to provide the GFE and Mortgage Loan Disclosure Statement/Truth-In-Lending Disclosure?

• Do you guarantee the GFE including the fees?

• How far in advance of closing will you be able to furnish me with a closing (HUD-1) statement?

• Will you disclose all fees and rebates that you or your company expects to earn, whether those fees or rebates are paid directly or indirectly by me?

• Will you be able explain in terms I can understand the purpose of all my closing expenses and who receives them, as well as an explanation of the fee amounts you expect to earn?

• Is it your company policy to disclose sales price and contract terms to the appraiser you hire to evaluate the property on my behalf? How will this disclosure or non-disclosure benefit or harm my financial interests?

• Is there Prepayment Penalty or extra fees for processing additional payments (i.e. bi-weekly or additional yr end or monthly payment)?

• What is the procedure for me to get a copy of my credit report and appraisal report and how quickly will you be able provide it to me?

• Can I choose the title company and appraisal company?

• Who can pay a portion or all of my closing expenses and are there any limitations on how much they can pay?

• Will you or your representative attend or be available (phone) at the closing of my purchase transaction to answer additional questions about my mortgage obligations and the loan documents I am required to sign?

• Is an escrow required? Can it be waived?

• Other than 20% down payment, what programs are available to avoid PMI?

• Are there any incentives for first time purchaser?

• Will you furnish me with a list of past borrowers for reference purposes? (Prefer a combo of references... recently closed - 2yrs).

• Can you handle purchase via:
- Corp (S-Corp/LLC)
- IL Land Trust
- Living Trust.
Will utilizing any of the above methods for purchase effect the loan, if so how?

• In the last three months, how many loan applications have you taken and how many were you unable to close?

• If I make the decision not to use your company, will I get my original loan package back, when will I receive it, and what expenses that I pay in advance will and will not be refundable?

• Can a mutually agreeable due date be selected, and what is the grace period?

• What are the chances the loan will be sold. If the loan is sold how will it benefit or harm me when I later expect services from you concerning my loan.

• How can you help me maximize the tax deductions of my closing expenses? Under what circumstances will you recommend that I refinance my mortgage to reduce costs and/or to enhance my equity position? What subsequent financial or other planning services will you provide me after the loan closing and when will those services be offered?

• What additional incentives do you offer?

Thanks in advance

I'd suggest you drop the tax/liability entity for now.

You can always create and LLC if you decide to rent the place out and contribute the property to it.

Things may have changed because of the current market environment, but even up to last year, half of your questions would be ignored if not all of them. Most brokers, unless desperate for business, would ignore a client like you. Why?

1. They don't know you. You are asking a lot of questions and they don't know if they are going to get anything out of it. Even if they do, are you going to be buying many properties or just one?
2. They know you are shopping. Unless they provide the best rates, they probably won't waste their time answering so many questions.
3. Rates, locks, conditions - they all depend on the lender that is chosen.
4. Nobody guarantees GFE. GFE is an Estimate only. You can ask them to guarantee their fees, but not the GFE.
5. Experienced Brokers know that clients that nitpick/have tons of questions/AND don't know the process aren't going to give them a good return on their time. (i.e. they spend all this time explaining to you and you fight them for every dollar)
6. Several of your questions can already be answered if you do your own research. It will just show brokers that you are not knowledgable.

I'm not saying that it's not a good idea to ask brokers all of these questions. I'm just warning you that most of the time, you won't get a response, unless you are planning on providing repeat business. Try reading the forums recommend by the other posters so you can improve your questions and cull them to just the right ones.

An idiot former accountant (or was it a lawyer? can't remember for sure) wanted something to bill for, so he talked one of my clients into putting a rental house in a S-Corp. Now the guy would like to unwind the S-corp so he doesn't have to pay me for a corporate tax return, but he doesn't want to pay $10k in income tax on the gain that would result from selling the house to himself. We ended up deciding to leave the problem to his heirs. They will get a step-up in basis on the stock and then they can liquidate.