Do Dealers get commissions on Financing?

[Peggy]

This is sort of a continuation of the question about dealer-located financing. I've been talking to a Fleetwood salesman who keeps figuring monthly payments on 6.25%. I've pointed out to him that there are several lenders listed in the newspaper (Atlanta Journal-Constitution, Homefinders section) who are offering as low as 5.63, 5.75 and 5.88 but he doesn't seem interested. He's mentioned the advantage of letting the dealership do all the legwork on finding a mortgage. Am I correct in assuming from the earlier posts on this subject that dealers get a cut out of the financing end of these deals too? I thought their commission was based strictly on the cost of the house. Can you (Mr. Murray, or anybody) clarify? It doesn't make sense that this guy would ignore a much lower loan rate unless he's getting a kickback from the lender.

Thanks

[rmurray]

6.25% is a good rate right now for a 30 year fixed rate lender with very low closing costs...1% origination..You should be able to get even lower for a 15 year mortgage..

Those adds are usually teaser ads..there is as much bs in mortgage ads as in autos and some manufactured home dealers...

Call some of those ads and find out the details...Watch out for high application fees...short rate locks..no rate locks...rate bumps with the credit process...

Some dealers to get paid on finance...but GA law would require they have a brokers license to recieve money from a mortgage loan...It is probably ok if they make a few dollars if the programs they offer are competitive..

[Peggy]

I'm not talking about the ads - I'm referring to the little box that's in every Sunday issue - I think it's on page 58 today - that lists about 50 lenders with their rates, discount points, origination points, etc. Maybe I'm dumb, but I DO think I could get 5.75% financing if I looked around. This salesman kind of rubs me the wrong way anyway. He's a little too smooth................................

[rmurray]

I found one of the best basic info sites on mortgages I have ever found...This IS NOT a commercial site selling mortgages..If is a finance professor that knopws most folks have lots of confusion about mortgages...

You can learn a lot here...I have..
Homes page
http://www.mtgprofessor.com/index.htm

A section on exactly your question..

http://www.mtgprofessor.com/A%20-%20Sho ... er_ads.htm

Copy and paste...this site has much for the homeowner...

[Peggy]

That's a GREAT site! The format makes it really easy to find the information you want, and it appears to cover EVERYTHING! I'll be referring to it many, many times, I'm sure. Thanks so much, Mr. Murray!