November 2006 Vol. 1 No. 1
In This Issue:
• 4 Good Reasons to Totally Ignore the Sunday Mortgage Chart • Debbie on Fox25 News • About Us

4 Good Reasons to Totally Ignore the Sunday Mortgage Chart

I have to admit that I'm a weekend-loving person. I work hard all week, and when the weekend comes, I like to kick back and relax. Peek in my living room window on a Sunday morning and you're likely to see my husband and me sitting on the couch, drinking coffee and reading the Sunday Boston Globe.

This past Sunday was no exception, and my morning was going just great… until I turned to the back page of the Real Estate section.

"Can you believe this?!," I shrieked, at my husband, who was engrossed in the sports section. "How can they have the nerve to print this 'mortgage comparison chart' week after week, right there next to the news, as if it actually contains useful, unbiased information?"

I don't exactly remember what I said after that, but I do know why I was so upset. Here you've got New England's largest, most well-respected newspaper, feeding information to unsuspecting home owners that is biased, out of date, incomplete and misleading, and putting it out there as a way to supposedly help consumers make educated decisions.

It doesn't make any sense. The fact is, I can think of at least four good reasons why you should completely ignore the weekly mortgage comparison chart in the Sunday paper when shopping for a mortgage.

  1. The Mortgage Chart Ignores Many Costs.

    When you look at one of these charts, the first (and maybe last) thing your eye goes to is the rate. We've all been trained to believe that the lower the rate the lower the monthly payment and it's nearly impossible to resist scanning the grid to see who's offering the lowest number.

    The problem though, is that the final cost of buying a mortgage product includes a lot more than just that one number. The price you'll pay for your mortgage will include some or all of the following: attorney fees, credit reports, a property appraisal, processing fees, and other hidden and not- so-hidden charges.

    Different lenders charge different amounts for each of these, and one way or another, all the people involved in the closing of your mortgage need to get paid. When you focus on the rate, you're only looking at a small part of the total picture.

  2. The Mortgage Chart Compares Apples and Oranges.

    For example, some of the rates quoted include points (an up front fee equal to 1% per point of the size of your loan) and some don't. The more points you pay at closing, the lower your mortgage rate will be, so comparing offers with different point structures is confusing, if not downright irrelevant.

    Or how about this? Some of the rates listed assume a lock period of as few as 15 days, while others go out to as many as 60 days. The lock represents how long the bank will guarantee a given rate for; an important number depending on when you expect to close. In general, the longer the lock period, the higher the rate (the higher rate is the bank's way of hedging its bets as it promises you something further out into the future.). But it's the same problem. If the lock period is different across the board, what does a difference in rate really mean?

  3. The Mortgage Chart Doesn't Apply to You.

    First, because the data is old by the time you see it. My Sunday paper dated November 5th has a footnote that says, "Rates as of 11-2-06." By Monday, when I call any of these folks, it's already four days old. Has the rate changed? Who knows?!

    Second, because as another footnote explains, "Rates based on $175,000 loan for single family home with 20% down…" But what if you need a $300k mortgage on a two family house with 35% down? Again, there's no telling how this affects you.

    My point is that by the time you call the lender, and depending on your specific situation, the relevancy of the chart data may have long flown out the window.

  4. The Mortgage Chart is a Paid Advertisement.

    Yes, that's right, you're looking at an ad! As hard as this may be to believe, and even though it's stuck in there amongst all the news, the mortgage grid is a paid, product placement, provided to the newspaper by a third party company whose clients pay to appear.

    The lenders listed are not independently chosen by the newspaper editor or anyone else on the paper's staff, and the rates quoted are self reported (all with no guarantee or obligation of course, and subject to change without notice).

I know, it can be disheartening, and I don't want to make the situation any more confusing. But I do want you to understand what you're looking at. It's one more reason why just asking what the rate is, even under the best of circumstances — which this is not — leaves a lot to be desired.

Instead, what I recommend is that you choose a lender or mortgage professional just as you would any other professional service provider: Start by talking to friends and family. If they had a good experience with a particular person or company, there's a good chance you will too.

You already have enough anxiety when financing a home. Just as you'd never pick a dentist randomly out of the phone book — or even worse, on the basis of a single, oversimplified statistic, such as "number of wisdom teeth removed per year" — please don't entrust the financing of the single biggest asset you own to a poorly compiled chart in the newspaper.

See you next month!

Debbie on Fox25 News

Thanks to Fox25 News for inviting me in to speak with Bianca de la Garza on her business program last month.

I really enjoyed having the opportunity to discuss my favorite topic – helping consumers find the best mortgage for their particular situation!

Follow this link to watch!

Hello! Welcome to the very first edition of "Raising the Roof!," my monthly guide to maximizing the financial potential of your home.

Lots of people own homes, but few seem to realize just how useful and valuable an asset a home can be.

Each month, I intend to educate you on financial aspects of home ownership. The result will be a savvy group of homeowners who reap every possible financial benefit of owning a home

Please share this newsletter with family, friends and colleagues. Help them get the most out of their home. If questions arise, just click "reply" to send me an e-mail. I know mortgages and home ownership can be confusing, so let me help!

Best regards,
Debbie Siegel
Westchester Mortgage

P.S. You're receiving this E-Newsletter because you have a prior relationship with me or with Westchester Mortgage. If I've sent this to you in error, or if you want to remove yourself from the list at any time, just click the "SafeUnsubscribe" link at the bottom of this e-mail.

Click here to read my "Mortgage Minute" in the ForeclosuresMass Monthly newsletter.

This month's column:
"What Does Mortgage Documentation Consist Of?"

November's Home Value Improver

With the leaves falling, now is the time to think about removing debris from your gutters!

Whether you do it yourself, hire someone else, or install gutter guards, don't overlook this important maintenance item.

Clogged gutters and downspouts can lead to water and ice damage, and a few minutes each Fall can go a long way towards protecting your home's value.

Westchester Mortgage simplifies the complex and often stressful process of finding the right loan program based on your financial goals and situation.

We provide unbiased advice regarding mortgage products offered by a wide variety of lenders. Our relationships with numerous banks and lenders allows us to select from thousands of programs to find the one that best meets your needs.

Follow this link for more information.

Enter your email here
to subscribe to

321 Walnut St. #412, Newtonville, MA 02460
617-965-1236 Fax: 617-965-1594

Copyright © 2006
Westchester Mortgage.
All rights reserved.