While the housing market is slowly seeing a setback, more people want to buy a house. When you come on the market for a new purchase, it is important to choose your mortgage company carefully. Although there are many companies offering mortgage offers, many home buyers want to use smaller companies that offer specialized customer service, such as Quicken Loans Inc. and SunTrust Banks Inc. (NYSE: STI STISuntrust Banks Inc58. 08-3.% Created with Highstock 4. 2. 6).
Quicken Loans is an oGeene Oneginine mortgage company that has been providing loans to the United States for 30 years. Between 2013 and 2014, it closed more than $ 140 billion in loans. It is the second largest mortgage lender in the United States, as well as the largest oeugene Oneginine mortgage lender. Headquartered in Detroit, Michigan, the company employs more than 13,000 people.
SunTrust is a super-regional bank with approximately 1, 400 retail offices and 2, 160 ATMs on the southeast coast, and offers a range of financial services to customers in the United States. As of December 31, 2015, it has a total of $ 191 billion in assets.
Comparing mortgage offers with individual banks is important to determine which type of loan is suitable for each financial situation. The two most popular choices are conventional fixed-rate mortgages and adjustable-rate mortgages. To compare each offer, the loan is calculated for the amount of $ 200,000 with a 20% down payment to purchase a first home in Okaloosa County, Florida, assuming the buyer has excellent credit. All data were valid from April 13, 2016.
30-year fixed-rate mortgage: benefit from quickening loans
The first rate analyzed is a standard fixed-rate mortgage for a 30-year loan. Quicken Loans offers an annual cost percentage (APR) of 3.93% and a monthly principal of $ 638. 48. Property taxes and risk insurance are estimated at $ 125 and $ 33 respectively, resulting in a monthly payment of $ 796. 48. The total estimated closing costs, according to Quicken Loans, are estimated at $ 10,415. SunTrust offers a lower APR of 3. 68%, but a higher monthly principal of around $ 890. With the same property tax and risk insurance estimate, a monthly payment with SunTrust is $ 1,048. The company does not estimate closing costs, but urges urge clients to consult with their brokers about any additional costs associated with the purchase of a home.
Advantage of Quicken Loans
The second rate analyzed is the variable variable interest rate (ARM) of 5/1, which is more risky than a conventional fixed-rate mortgage. This mortgage has a fixed interest rate for the first five years and then adjusts based on a fully indexed interest on an annual basis. This type of loan is usually more risky because the interest rate might be higher than the original rate, which would increase monthly payments. This type of loan is more attractive for a homeowner who is not planning to stay in his home after the first five years, or who is planning to refinance.
Quicken Loans offers an APR of 3. 645%, which is lower than the 3.38% offer of SunTrust. The monthly principle for Quicken Loans is approximately $ 599.73, lower than the estimated value of $ 811 for SunTrust. Based on the same $ 31 risk insurance policy and $ 125 property tax, the total monthly payment for Quicken Loans is estimated at $ 757.73 and $ 969 for SunTrust. Quicken Loans estimates that the potential monthly principal after the first five-year fixed-rate period could rise to $ 1.003 for taxes and insurance. SunTrust estimates that the potential monthly principal will rise to around $ 880 for taxes and insurance.
The bottom line
All information provided by Quicken Loans and SunTrust is only an estimate and each quote has many factors that may affect it. Both websites offer very simple mortgage calculators that only give a general idea of how a loan is granted. The customer must contact an agent to receive a more detailed mortgage quote for both companies.
Using a simple scenario, Quicken Loans offers customers a lower option for both the 30-year fixed loan and the 5/1 ARM. It is important to remember that the choice of a bank depends on the preference of a customer and the financial situation.