Frequently Asked Questions

A Rebate by definition is; a partial refund to someone who has paid too much money. A better term is Lender Credit, which far more accurately conveys what is really occurring in the modern mortgage marketplace. Borrowers today have many more choices available for mortgage financing; lets start by understanding the meaning of Par Pricing, which is the rate available to the borrower without any origination or discount points paid for a specific rate of interest. The borrower would only pay standard lender fees and closing costs.

If a borrower selects a note rate that is lower (better) than Par pricing, he will have an additional cost in the form of Discount Points (or portion thereof), which is a percentage (%) of the loan amount, buying down the interest rate for the whole term of the mortgage.

Conversely, is the borrower selects an interest rate that is higher (worse) than Par Pricing, he will receive a Lender Credit, that will act as a cash contribution toward closing. As the interest rate goes higher, Lender Credits will increase to a point where there is no cost left to pay in the closing of the transaction, hence the term; No Closing Cost Transaction.

Lender Credits can be substantial, and have the capability of paying for any and all Lender, Escrow, and Title fees in purchase or refinance transactions, and may also contribute the establishment of the borrowers Impound Reserve account, if they select, or are required, to have one.

Lender Credits may not be funded to borrowers in the form of cash disbursement at closing or in any way be applied to down payment requirements of purchase transactions.

Lender Credits have made modern day financing affordable, and far more convenient. See Empire’s Instant Mortgage Rate Quotes.