Chicago, IL · Member since 2015 · 414 posts · 94 votes
I'm in the process of getting pre-approved for an FHA loan to buy my first multi-unit and I got a letter in the mail from Marketplace MC saying they'll give an FHA loan with a "2.75%(3.14%) APR for a 15 year Fixed Rate!" or a "3.25% (3.46%) APR for a 30 year Fixed Rate!" It says my credit score can be as low as 580 and they'll pay my closing costs.
1. What's the catch with this? Are they advertising the best rate someone could get and the worst score you can have for FHA just to get inquiries and then will offer you loans with higher rates?
2. Why would a lender pay my closing costs? Might be worth paying a slightly higher rate if they'll pay my closing costs.
3. How did these people get my information and learn that I'm shopping for a loan?
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
10y
It means nothing, they're just prospecting. Trust me, use a local experienced FHA lender. You can talk to them about lender credits, and yield spread premiums, in which they will give you money back for closing costs, for a higher interest rate. The analysis is up to you.