INTEREST RATES 

One of the most common questions from potential borrowers is, “what is your interest rate?” We realize that the borrower is only trying to find an easy way to compare the cost of the loan that CTX offers against the cost of competitors’ loans, but we don’t want to be misleading. The interest rate is only one facet of the loan program: the closing costs and fees and the features of the loan program are also important factors in your determination of the best loan program for your situation.

CTX offers a large number of programs with various options, each of which may have a different overall cost. Lenders would rather not quote an interest rate before we have all the facts of your individual situation. Without being sure of the loan program, the costs and fees associated with that program, the home’s ability to meet our guidelines and your ability to qualify for the loan, any rate that the lender quotes to you could change.

In fact, it’s not uncommon for some of our competitors to quote an extremely competitive interest rate without understanding your individual situation, but then later disclose high loan fees. The total cost of the loan, despite the lower interest rate, could exceed the cost of a loan with a higher rate but more reasonable fees. To compare the cost of one loan with the cost of another loan, you need to take into consideration the rate, the particulars of the loan program and all the fees. It may be impossible to compare the interest rates on two different loan programs because the two programs (like a fixed-rate versus an adjustable-rate program) are so different.

Once you have narrowed your decision to a single loan product, one of the best ways to compare the price offered by two lenders on that loan program is to compare the annual percentage rate (APR) that each lender offers (please see the section on APR for more details). The APR calculation is a shorthand method to take both the interest rate and closing costs of a particular loan into account.


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