"Spot" Rate Quotes Are No Good.

Most lenders offer a minimum of 10- to 15-day pricing, and this is usually reserved for those loans that are already in the lender's office. Such quotes are sometimes called "spot" pricing. They're good only right then and right there. Ten days is rarely enough time to put a loan package together. It can be done, but most lenders shy away from such pressure if they have a choice.

When you make rate quote calls, some lenders will quote their io-day price, which is usually about 1/8 point less than a 30-day price. On a $300,000 loan, 1/8 point equals $375. Other loan officers will automatically quote a 30-day price, others will be instructed to quote a 10-day price, while still others will have a choice as to what to quote.

To avoid this problem, demand a quote from all lenders for the exact period you need in order to close.

Finally, try not asking for their rate, but giving them the rate you're looking for and having them quote you. Instead of asking, "What's your 25-year rate quote for a 30-day period?" you should ask, "Can you please quote me a price on a 25-year loan, good for 30 days, at 5.50 percent?"

This is comparing exactly apples to apples. Lenders offer rates in eighths of a percent. A lender won't have just 5.00 percent or just 6.00 percent, but will offer a range in 1/8 percent increments. A lender's rate sheet will look like this:

30-year mortgage

15 day

30 day

60 day


2 pts

2.25 pts

2.50 pts

















And so on. Lenders can have rates that go as high as they can stand, but typically the lowest and the highest rates they price will be only 2.00 percentage points apart. In this case, the highest rate would be 7.00 percent, or 2.00 percentage points above the lowest rate.

Absolutely every mortgage company has a rate sheet similar to what you see here. It lists the rate, the period the rate is good for, and how much it would cost for both the rate and the time.

Now you say, "Please quote me your 30-year rate, good for 60 days, at 5.50 percent."

You have just neutralized the loan officers' quoting weapons by defining the terms. When you set the quoting parameters, loan officers have less opportunity to play the shell game with you.

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