Am I getting screwed on mortgage interest rate?

[Tadas Saudargas]

Hi, I'm getting a conventional 30 year loan on a $250k townhouse, 20% down, fixed rate. I'm working with a small lending firm (recommended by my RE agent) and we're getting close to "locking" the interest rate. The lender told me it will be around 5% to 5.125%. It seems high to me. I went on the consumerfinance [dot] gov website, set it up for my location (Illinois) and loan parameters and it shows a chart with rates from 29 different lenders, with rates ranging from 4.000 to 5.625. Only 3 of the 29 are over 5.000. If these rates are approximately correct, then I feel the rate I'm being offered is high and it will cost me quite a bit over the lifetime of the loan. I asked the lender if I can get a better rate by going with a 15-yr mortgage, and his response was "we can probably make it with a 4 in front tomorrow". He's looking at the trend of the 10 year treasury note expecting it, and thus the rate, to keep trending down. I have my own opinion regarding trying to predict future rates, but I will keep it out of this post.

So, I'm looking for feedback regarding whether this is a fair rate in today's market in Illinois.

Credit score = 800+ and townhouse is classified as si gle family attached, all factors pointing towards a lower interest rate on the spectrum.

Cheers,

Tadas

[Chris Mason]

Originally posted by @Tadas Saudargas:

@Chris Mason

Thanks, I realize I started paying attention to this too late. A good lesson.

I'm curious, what do you mean by "independent" broker?

 Wholesale lender. No middle management. No big national brand. No big fat corporate overhead. No granite counter-tops. All that crap is baked into your rate.