Rate Match Guarantee! Beware of POINTS! Rates: Sticky Down/Slippery Up

JVM’s Rate Match Guarantee

We now have a Rate Match Guarantee at JVM.

If borrowers bring us a valid rate quote on a formal Loan Estimate before their rate is locked, we will match that quote.

Our only exceptions will be for some portfolio jumbo loans offered by some of the major commercial banks.

Beware of Points (2 Points – To Be Exact)

One of the reasons we are offering our Rate Match Guarantee is because so many borrowers are getting misled by artificially low rates that are subsidized by ridiculously high fees (primarily in the form of points or origination fees).

By encouraging borrowers to send us Loan Estimates from those lenders, we can explain to borrowers why their quotes are not nearly as “low” as they think they are.

What is problematic though is that borrowers are often lured in by those low rate offers – and then they often end up sticking with those lenders, despite being misled. This is either because the borrowers deem it too difficult to re-apply or because fast-talking loan officers somehow convince those borrowers to stick around.

Some of the most popular rate comparison websites (that are really just lead-gen tools) often have rates that require borrowers to pay two full points! Reminder: a “point” is 1% of the loan amount.

While we can invariably match those rate quotes, we never recommend paying points. This is because borrowers almost always end up paying off their loans (via a sale or a refi) before they recoup the cost of the points from their lower payments.

Rates: Sticky Down/Slippery Up

Rates fell surprisingly quickly in response to geopolitical tensions over the last week. This was largely a result of a massive “flight to safety,” as investors moved from stocks to bonds – as discussed in this recent blog: How the Russia/Ukraine War Is Impacting Rates.

But – they shot back up today in response to some strong economic news and renewed inflation concerns. This is because oil prices are expected to rise sharply as a result of the Russia/Ukraine situation (because massive Russian oil supplies may be taken out of the market) – and that is expected to further fuel inflation.

This is why we always recommend that borrowers lock as quickly as possible when rates do fall because rates tend to move up much faster than they move down.

Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167