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rated:
I wanted to share my recent refinance experience with better mortgage (wwww.better.com) company with the fatwallet community.
this is a startup company funded by finance giant Goldman Sachs, and there is a reason this company is doing so well.
As the company claims, its fully online .. starting from application --> under writing -->Closing. They ask you explanation\documents through their web interface.
Its like Amazon of the mortgage industry .. top notch customer care with the cutting edge technologies.
Pro - 1. you can get pre approval in no time.
         2. They assign dedicated representative to help you through process.          
         3. Rates they offer is very competitive but the best part is their "Best Rate Guarantee". All you have to do is to get loan estimate from any other broker\company and they beat the offer by         $1000.  What is more helpful is you can increase you locking rate by 1/8 point and will accumulate enough credit to cover your closing cost. and you can do all these online by yourself.
    so in my case, i got estimate for 3.8% from some other bank, better mortgage offered me 3.75% rate with $1000 credit. They added the credit to my profile so when i tried rate for 3.875%, i was getting 5K credit which was more than enough to cover all my closing cost.
        4. There was no surprise or extra charges during the closing.
        5. They also claim if they will not be able to offer your the mortgage then they will refund you to rate lock fee($500), so you are not loosing any money.
Cons - 1. They ask too many documentations. may be because they sell the MBS to bigger bank.
            2. Servicing also gets transfer to somebody else ... i wish they were the servicer for my loan as well.

To summarize, I will highly recommend to try them as you can get the rate guarantee even before you pay them the rate lock fee. the way it works, you put your application online and they assign some loan consultant to you. You can forward the loan estimate from anybody (loandepot, quicken, anybody) to the loan consultant and they will get back to you with their counter offer in no time.
At that point you will have $1000 credit in your account and you play around with the rate to get enough credit for your closing cost.
I was able to finish all these on the same day.

 

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rated:
I entered my zip, but they are not available in MA.

Turns out they are available in Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, New Jersey, North Carolina, Oregon, Pennsylvania, Washington and Washington, D.C.

rated:
All mortgage brokers I've ever used have the exact same process -- online application, dedicated loan officer, and no surprises or extra charges at closing (there are laws against this). Adjusting the rate up or down is something they all can do, although not online (even if you have a lock, the adjustment and closing costs move up/down based on the original lock). Everyone asks for documentation, there's no such thing as "too many documentation", they all follow fannie and freddie guidelines for the most part.

I have seen Better at the top of the list on zillow before, but not recently, and the quotes on their website are 1/8-1/4th of a point higher than the best rates on zillow for the same closing costs. That "Best Rate Guarantee" sounds like a winner, if they actually honor it.

mgupta001 said:   ...you can get the rate guarantee even before you pay them the rate lock fee.This is not a "can" but a "must". First item in the fine print says:
The offer is only for customers who haven’t yet locked with Better Mortgage.

rated:
scripta said:   "Everyone asks for documentation, there's no such thing as "too many documentation", they all follow fannie and freddie guidelines for the most part."
 

  You are right about the  fannie and freddie guidelines but in my prior interaction with other bank/broker i never gave them so many documents/explanation.
  such as proof paying off IRS dues from last year, terms for 401K withdrawal, etc
Anyway it worked out well so it was worth the time.
Best part for Better Mortgage is excellent customer Care .. in the mortgage industry where customer care is negligible.
Better mortgage CEO is also accessible and responds to email if you send him a note. They try to go above and beyond to keep you as a happy customer.
 

rated:
OP, I had a very similar experience a few months ago. I shopped around heavily (online + B&M + brokers) and they were the best rate and their actual process was about as good as one could expect. I did point out some areas with room for improvement (i.e. better price sheet availability) but I was very impressed.

I don't feel their documentation requirements were any more onerous that other lenders today (much more than even 3-4 years ago though).

Definitely shop around, TELL them if you find a better rate BEFORE locking. The title insurance and escrow company they selected, which I also always shop around for, were a few hundred cheaper than anything I could find on my own.

A family member tried to use on his purchase in the DC area, but they have some local tax incentives and the Better folks weren't super familiar. He wound up going with a local broker and got a great rate elsewhere (but without the VERY smooth process).

My note wound up sold to someone random with Wells Fargo servicing.

rated:
i have tried to get quote from them several time. they were nowhere close to rate i get from other local brokers.

rated:
MeraNamJoker said:   i have tried to get quote from them several time. they were nowhere close to rate i get from other local brokers.Did you know about or attempt to use their Best Rate Guarantee?

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They are 1/8 point lower than my current rate but I just refinanced earlier this year.

rated:
scripta said:   
MeraNamJoker said:   i have tried to get quote from them several time. they were nowhere close to rate i get from other local brokers.
Did you know about or attempt to use their Best Rate Guarantee?

  Their rate is a quarter percent higher than my local bank. Maybe their rate matching would work out but why make people go through the trouble of getting another loan estimate if their selling point is convenience.

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Worst jumbo ARM rates I've seen in quite some time.

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otaymiester said:   Worst jumbo ARM rates I've seen in quite some time.
  try thirdfederal bank.

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At what rate difference does it make sense to go through the hassle to refinance?

I can drop the rate 0.125% at the cost of $3k closing cost. I have a 15 year loan, <1 year in.

Approx savings in monthly payment, based on the online calculator I am using, is approximately $100 per month. Part of this $100 is due to the extended term (by 6-7 months), and a part of it is due to the lower interest.

Any quick and easy rule of thumb when it is good to refinance?

Also, do we expect mortgage rates to tick up or down during the pending debt ceiling fight in October? It would go up - right?

rated:
puddonhead, the go/nogo point will vary for people, but what I look at is the length of time to recover all refinancing costs. It's important to break down 'closing costs' to factor out the ones that you'll need to pay anyway - mostly escrow and interest. But appraisal, application fee, title insurance and services are actual costs the refinance would generate. And then it sounds like you're looking at the other two numbers - cash flow savings and interest cost savings. I think both are relevant, though when refinances were coming every 2-3 years, the term extension impact was smaller.

I think I was generally looking for a 12 month max payback based on cash flow savings. I would use the same numbers to figure out how much cash a .125 rate change was worth to me, so I could quickly decide on lender credit/rate combo options.

And almost everyone has been wrong about near-future mortgage rate movement for about twenty years. I think they're likely to be going up in general for the next 5-10 years, but I wouldn't bank on timing around specific events like the (probable) debt ceiling fight. Figure out your threshold for a good deal and jump in whenever a good deal is available.

rated:
>> I think I was generally looking for a 12 month max payback based on cash flow savings

Thanks for the very useful rule of thumb.

Incidentally, I also made a 5 minutes call to my lender's (DCU) loan origination department. The loan originator told me that he routinely recommends 0.5% as the threshold for customers with 15 year loan. I ran the numbers, and the "payback" period based on 0.5% is in the ballpark of what you mentioned - 10-12 months!

<off topic>
For those who are not familiar - DCU is a credit union and has very good customer service. Almost all of them are employees of DCU - and not outsourced!
I routinely ask their CS guys "what did you do with your mortgage?". Quite often, they will give very useful guidance. In one instance - the CS guy asked around to find a colleague who had faced a similar question and got back to me.
</off topic>

rated:
My rule of thumb is immediate profit or savings on a no-cost (zero or near zero out of pocket) refinance. I've expressed (and explained) many times in mortgage and RE threads here that paying any fees or points out of pocket makes no sense in most cases. Any money spent out of pocket is simply wasted if the rates are on a downward trajectory and you refinance again before the fees pay off. If the rates are flat or moving up, then the money spent doesn't pay for itself for about 8-10 years (on a 30-yr loan, haven't ran the 15-yr scenarios). It is much better to accept a slightly higher interest rate and use the lender credit to cover all the costs. It's even better if the credit exceeds costs and you get paid for doing the refi. In such cases even an 8th of a point can make sense -- in my last refi I went from 3.5 to 3.375 (30-yr fixed) and made a net profit of $1100 ($2000 in costs - $3100 lender credit), not to mention immediate and long-term interest savings.

Prediction is very difficult, especially about the future.

rated:
All mortgage companies I've used have always been the same: good experience until you pay for appraisal then it's like pulling teeth to get it completed.

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Just received an e-mail from them which highlighted their "The Better Price Guarantee". Has anyone taken them up on this offer? My brother received a similar deal with Capital One and surprisingly, Capital One honored their guarantee! In fact, they ended up paying $15k to buy down the rate to the one he got from a competing lender (net after all fees, he did about $1k better than competing lender). I'm hoping Better Mortgage is the same with their guarantee.

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