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PricingNerd

New MLOs lose deals because they quote the first rate that pops up in the pricing engine. Here is how I work the stack to be competitive without giving margin away.

Step 1 — always run 3 lenders minimum. Price the loan at 3 different wholesale lenders in ARIVE/Optimal Blue. Same parameters. The spread on identical scenarios can be 25-75 bps. If you only quote one lender you are often 50 bps off the best price and do not know it.

Step 2 — decompose the lender-credit stack. Every lender has a base rate, then LLPAs (loan-level price adjustments) for credit, LTV, occupancy, purpose, property type. A 620 FICO on a 2-4 unit investment property can have 4+ LLPAs stacked. Run it at 660 vs 680 vs 700 to show the borrower what small credit improvements unlock.

Step 3 — lock window vs float cost. 15-day locks are 12.5 bps cheaper than 30-day, 45 on average. If your processing is tight and you can guarantee a 15-day close, use it. Borrowers feel the rate, not your scramble.

Step 4 — your comp election. Lender-paid vs borrower-paid comp can swing the rate 25 bps. Know the math on both for every loan. I always run both and show the borrower.

Step 5 — the "match plus" close. When a borrower brings a competitor LE, never just match it — counter with the same rate AND one concession (faster close, paid appraisal credit, waived origination). You win on value, not just rate.

Margin-protection rule: never cut your BPS comp below 100 on A-paper. If the deal does not pencil at 100 bps, it is not your deal.

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Jon Howard

Solid framework. I run a nearly identical process and would add two tactical moves that compound the pricing edge:

  • Lock extension math as leverage — when you quote 3 lenders, ask each for their 60-day vs. 45-day vs. 30-day lock price. Most pricing engines hide this. The 30-day price on a clean file can be 12–18 bps better, and you can often close DSCR / conventional in 21 days if you front-load docs.
  • Flat-dollar credit vs. par pricing — on files where the borrower is rate-sensitive but cash-short, buying the rate down with your own comp (lender credit from your concession) rather than borrower points preserves the relationship and saves them closing cash. You eat a bp or two; you earn the referral.
  • Never quote before rate sheets refresh in the morning. MBS moves overnight; a 7:30 AM quote using yesterday's sheet costs you deals or margin.
  • Pricing stack by loan type — UWM usually wins conventional purchase, Rocket Pro TPO often wins jumbo, Kind / Newrez usually win non-QM DSCR. Know the defaults so you are not running 6 engines on every file.

Practical next step for newer MLOs: Set up price sheets from your top 5 lenders as browser tabs every morning. Spend 10 minutes comparing par rates on a benchmark scenario (720 FICO, 20% down, $400k, 30-yr). That 10 minutes tells you who is competitive today and saves an hour of pricing-engine roulette.

Happy to run your specific numbers — call 970-457-9107 or email jon@homesteadcapitalpartners.com.

NMLS #2587985 · Licensed Colorado · For educational purposes — not a commitment to lend.

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HelenaBuildsMLO

Adding Newrez to the non-QM DSCR shortlist — they've been competitive the last two quarters on 1.0+ ratio files in my market. The rate-sheet-timing rule is something I literally wrote on a sticky note above my monitor: "no quotes before 10 AM ET on Fed days." Saved me from eating ~30 bps on two files this quarter alone.

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Maya Thompson

Marketing intern — I've been helping build out HCP's rate-market social content and the "quote after rate sheets refresh" rule Jon mentioned is something I've started baking into our content calendar too. We only push rate-related social posts after 10am ET on market-open days because anything earlier gets stale fast. Same logic as quoting borrowers. The flat-dollar-credit-vs-par-pricing thing would be a great TikTok explainer honestly — "how your MLO actually prices your deal" is the kind of content that builds trust in a feed.

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MortgageMomma

Jon — agree on everything, especially the lock-window math. I've started quoting 21-day locks by default on clean DSCR files because the pricing advantage is real and most of my files can actually close in that window if I front-load docs.

One add: Rate-sheet notifications. I subscribe to the morning rate-sheet emails from my top 4 wholesale lenders and scan the MBS headlines from MBS Live before I quote anything. If the 10-year is moving 10+ bps overnight, I wait until 10am when the reprices settle. Quoting in the first hour of a volatile day is how you either give away margin or lose a deal when you have to reprice.

On the "flat-dollar credit vs par pricing" point — this is huge for rate-sensitive borrowers but I'd warn newer MLOs: know your branch's comp plan before you start eating bps. Some shops let you flex comp down to a floor, others lock it. Get the boundary in writing from your branch manager before you promise a credit to a borrower.

The "UWM conventional, Rocket jumbo, Kind non-QM DSCR" heuristic matches what I see too. Adding Angel Oak as a strong second-place on non-QM — their 12-month bank statement is often half a point better than Kind on the same profile.

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