A new mortgage pricing tool, RateSpeed.com, went live this week promising to show consumers wholesale rates and yield spread premiums lenders pay to mortgage brokers — without asking for their personal information.

Participating loan originators and mortgage brokers must also disclose their fees, ensuring a transparent process, said developer Jeff Corbett.

Consumers are asked to provide their e-mail address and fill out 19 information fields about the prime, alt-A or subprime loan they are seeking. In return, they get back five pricing options in loan categories, including 30-year fixed-rate, 15-year fixed-rate, 5-year adjustable-rate mortgage (ARM), and 3-year ARM.

The five options allow borrowers to choose whether they want to "buy down" their interest rate or pay more than the par rate in order to earn a yield spread premium — cash rebates that can be applied to their lender’s fees or other closing costs.

"We don’t sell leads or charge for the traffic that we generate," Corbett said. Consumers enter their ZIP code and other information and "we pipe it down to the broker running the local application — to anyone licensing our application."

Searches are free to consumers. Corbett said his Newport Beach, Calif.-based company, REtech Group LLC, intends to charge a setup fee in the neighborhood of $499 for mortgage professionals who want to install the tool, and a monthly hosting fee of about $199 will allow for unlimited queries.

The RateSpeed tool can be customized and embedded on a banker or broker’s Web site, providing pricing information for lenders they have relationships with. In that respect, it’s similar to another recently launched loan shopping widget, RateWindow (see story), which Corbett had a hand in developing.

Consumers can also make queries directly from the RateSpeed site, and can receive updated rate information on their requested loan scenario fed to their RSS (really simple syndication) reader, Corbett said.

Powered by Milwaukee, Wis.-based Loan Runner, RateSpeed returns results that include interest rate, annual percentage rate (APR), monthly payment, yield spread premium credit, broker/banker fee, and net cost.

According to the site’s blog, RateSpeed will be enrolling 25 mortgage professionals as beta testers. Lenders providing pricing information include CitiMortgage, Countrywide Home Loans, Credit Suisse First Boston, GMAC Mortgage, JP Morgan Chase, Morgan Stanley, SunTrust, Thornburg Mortgage, US Bank and Wells Fargo.


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