Best Mortgage Rates Rarely Found On The Web

Author: Rob K. Blake | Date: September 20, 2007 | Filed In: Mortgage Rates

All the online rate advertising websites claim to have the best mortgage rates. It is easy to claim you have the best mortgage rates when you have no oversight.

There is more than one lawsuit claiming the rates Bankrate.com, for example, post are manipulated by the companies that advertise on their site. A recent $46,000,000 verdict was pinned on NovaStar for allegedly making false mortgage rate postings on Bankrate.com. They plan to appeal.

The interesting part of the case was that NovaStar along with 2 other advertisers had pressured Bankrate.com into removing the plaintiff’s (American Interbanc) rates from the site!

Now, Bankrate.com was not named as a defendant in this case, but it does beg the question,

“Is Bankrate.com a trustworthy source of rate data if they are so easily manipulated?”

Bankrate.com has been named in a lawsuit in 2006 claiming their rates are unreliable. According to an article on Post-Gazette.comby Michael Hudson, originally published in The Wall Street Journal,

“But the company’s reliability as a consumer tool is being challenged in the lawsuit, filed by a former advertiser, that accuses the company of allowing its Web site to become a haven for “bait-and-switch” loan pitches. Testimony and internal company documents filed with the court show Bankrate has fielded hundreds of complaints about mortgage lenders who fail to deliver the rates they advertise; one lender told a Bankrate employee a consumer would need “a direct pipeline to God” to qualify for its advertised rate. The legal battle, which began in 2002, is scheduled to come to trial this fall.”

A “haven for bait-and switch”..”fail to deliver rates they advertise”…”need a direct pipeline to God to qualify”…does that sound like a website worthy of your trust?

“Okay, so where do I go for the best mortgage rates if not Bankrate.com?”

Glad you asked…

The website is called HSH.com. They publish rate data, not from advertisers, but from a survey they conduct with the participants agreeing to providing closed rates, not advertising rates.

You know, the bait-and-switch kind of rates.

They also survey more than 2,000 banks and brokers across the country posting a daily rate, by far superior to the Bankrate.com or even the Freddie Mac rate survey.

So for example, I’m searching all three sites today, 7-17-07, and find

1.) a 30 year fixed conventional fixed rate on HSH at 6.89%,
2.) at Freddie Mac a 5 day old rate of 6.73%,
3.) and Bankrate.com on the same day, says 6.31%.

So tossing out Freddie Mac, leaves us with HSH at 6.89% vs. Bankrate at 6.31.

Now we all know mortgage rates are issued on the eighths. For example, 6.125%, 6.25% for conventional fixed rate loans. There is no such rate as 6.89%…these online rates are averages, so to convert each rate to what a consumer would actually see, you need round up to the nearest eighth of a percent. 6.89% becomes 7.00% for HSH and 6.31 becomes 6.375% for Bankrate.

Bankrate’s advertiser based rate is the “bait”, HSH’s closed loan rate is the “switch”.

So the question you must ask yourself is, would you rather know your real rate going in, or believe a pie-in-the-sky, “We have the best mortgage rates”, website lie.

Lastly, these rates are retail rates not wholesale or what I call real rates. Rate profiteering…what the industry calls yield spread premium overcharging is commonplace and you’ll need a source for real rates.

The only source online for real mortgage rates is listening to our Daily Real Mortgage Rate Updates audio, so check that out!

Learn our one-of-a-kind process for finding the best mortgage rate every time in our shopping system.

Good Luck!

PS: Need to find the best mortgage rates…what we call REAL mortgage rates? Check out The Mortgage Insiders Podcasts- Daily Real Mortgage Rates a 1 minute audio daily report of the current REAL mortgage rate!

Author: Rob K. Blake