October 16th, 2009 9:02 AM by BILL WILBANKS
Our ZERO Points Means ZERO
We quote Total Points Folks!
This is very important. Companies quote "ZERO POINTS" every day in all the national ads, but it's a play on words in far too many cases. After stating they have zero points they proceed to state (if they even bother) that it's plus a $2,500 origination fee and other 3rd party fees like title and appraisal (and many others). This was actually quoted on a $200,000 quote from a well known national advertiser in the fine print. Well, divide $2,500 by $200,000. Isn't that a 1.25% fee on that mortgage size? BUT, if it's not shown as POINTS, but a flat fee instead...they boldly advertise ZERO POINTS. Get it now?
Many who market this way simply run a rate and an APR (annual percentage rate) in their ad which is the minimum required by law and don't reveal the dollar origination and closing fees and you must give them your basic information to get a written estimate. How many dollars does an additional .10% APR mean to the average rate shopper? Without calculating it, even I can't say. That's why the Rate VS. APR quote is so effective.
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