Several of Bankrate's clients have been hit with a $46 million judgement for "bait and Switch" techniques". I posted a blog on this earlier Bankrate is feeling the Heat, and am pleased with the results. The courts have gone after a big company, Novastar, as well as several small companies. To get the details, read the Inman article Novastar, other Bankrate Clients Hit with $46, Million Judgement.
Bankrate has fostered a climate of deceit for to long and it's good to see that it is no longer tolerated. They, and many other Internet "information" sources are really nothing more then lead generation sites. I don't have a problem with that, but when I'm told by clients that I have to compete against a rate that I know cannot be done, it makes me, and our industry look bad.
When I see lenders quote rates and closing costs only to change them later it makes me sick. When I see Realtor website linking to Bankrate or Lending Tree I shake my head in amazement. If only they knew the truth...
What about looking out for the best interests of the client?
Lenders, this means honest and accurate GFE's. Do your job!! Make some phone calls!
Realtors, this means communicating with your client's lender to make sure that the deal is solid. Don't look away OR steal the lender's client and refer him/her to your lender. Communicate.
Borrowers, this means using some common sense. If it looks to good to be true, it is! We all get our loans from the same pool of investors and rates/fees shouldn't be that different. Until a loan is approved, with all conditions signed off and a rate locked, you don't have a deal! Don't shop for the lowest rate/fee, shop for the lender who is honest, can get the deal done and offer a fair price.
Larry Morris is a Certified Mortgage Planning Specialist and Certified Mortgage Coach with Golf Savings Bank in Beaverton, Oregon. He specializes in USDA Guaranteed Rural Home Loans, FHA Purchase and Refinance, FHA 203k Rehab loans, FannieMae HomePath loans and conforming purchase and refinances in the states of Oregon, Washington, Idaho and California.
He can be reached at 503-421-0096, or larry@PDX-Mortgage.com.
People seem to always want to think that there is some magic lender with a magic deal. Here in St. Louis there is a box on the front of the Sunday real estate section that I call the "Liar's Box". If you advertise there and are truthful with your quote, you look like you're out of the market. I choose not to advertise where I have to lie to look competitive!
Bob Mitchell
ValueList Real Estate Services, Inc.
Michael - Feel free
Bob - I couldn't have said it better. I used to work with a guy who always advertised as the lowest rate. He was eventually let go as my old boss couldn't afford to have him around...