Hi {first_name},

I hope you're enjoying this educational content regarding the Top 5 Question You Should Ask Every Loan Officer.

In my last email we talked about why mortgage rates are constantly changing and today we're going to talk about what's more important: rates, fees or points.

What's More Important:
Rates, Fees or Points?

It truly depends on a few factors. If you plan to have a loan for a very short period of time (two years or so), trading a slightly higher rate for a larger rebate may make sense.

As a general rule, raising the rate .25% will increase the rebate from the lender by 1% of the loan amount. On the other hand, someone who expects to have a loan for a very long time may benefit from a lower rate attained by paying “points” (one point is 1% of the loan amount).

Mathematically, paying 1% of the loan amount to reduce the rate by .25% will break even in about four years, but it seldom makes sense unless the borrower plans to use the lower rate to pay off the loan faster.

As far as fees are concerned, you have to make a distinction between lender fees (underwriting, document prep, processing, etc.) and third-party fees (title, escrow, appraisal, recording, notary).

The consumer should get a written estimate of all the fees involved in the proposed transaction, and then compare their options. Case in point: One lender may have $1,000 in underwriting and processing fees, while another has none—but if the “cheaper” lender has rates that are .125% higher, it may be a false economy to go “cheaper.”

Whether you're a first-time homebuyer, looking to buy a second home, refinance your existing loan or find the home of your dreams, {company} has the knowledge and years of experience to provide you with a loan that fits your exact needs.

If you have any questions or would like to speak to me personally please don't hesitate to reach out.

Sincerely,