Look for how large of a gap there is btwn interest rate & APR that tells you if there are hidden fees.

GFE should be w/in 10%.

There are potential rebates back to the originator after the loan is sold on the secondary market, not something that can be quantified ahead of time b/c nobody knows what a given portfolio will sell for later.

The loans get bundled up & auctioned off after they're closed.

Yes there are a lot of sleazebags in this industry.

And there are sleazierbags cropping up trying to confuse consumers even further.


There are 3d party fees that must be paid irrespective of the type of loan, ie appraisal, processor, title, escrow, credit report, (btw we can only legally charge our actual cost for the credit report, I pay $15 for a trimerge) etc.

Originators can charge an origination fee, it's how LOS get paid.

I sell my loans at par meaning the lowest interest rate available for the client. I have lost $ doing it but right is right & I believe what comes around goes around.

As for all those no cost loans on TV the big lenders can absorb a lot of costs just to make a loan b/c they make it back on volume. Most LOS can't feed their families making $150 per closed deal. But not to worry a lot of those loans will get the consumer on the back end.

Interest rate vs APR spread is a good indicator, IMO.

Thanks Diva! I've come to understand the 3rd party fees now along with orig fee and YSP.

You say you sell at par. Is your only take home from orig fee? I've been curious about orig fee vs. YSP. Many people seem to want to not pay closing costs, especially those associated with loans (orig fee, appraisal, credit rpt, processor, etc). If you educated a consumer do you think most would opt for using YSP to cover closing costs and your fee to minimize their down payment? Or do you find that most would rather a lower rate and pay out-of-pocket up front?

Thanks again!

Bump, I'm still interested in the PAR vs low/no closing cost angle with consumers. Seems a lot of people concentrate on low fees which makes me think you would need YSP to get paid? Any further information would be appreciated. Thanks!