If you are buying a home for the first time, or if are an experienced homeowner who knows all about home financing, you need to be sure that you choose the best mortgage lender.
When you are trying to find the best mortgage lender, you are not looking for one who has lots of money to lend, but one who can give you the right loan. Home loans are spread over 15-30 years, and it is vital that you can choose the best option.
The most important thing in a mortgage loan is the interest rate. Interest rate differences may appear to be small, but can make a big difference to the overall cost of the property you are buying. If you want to compare rates, use an online mortgage calculator and see the difference that even 25 basis points can make to the total interest.
If you want to get the best interest rate, get as many rates as you can. Do not hurry; instead, shop around for the best rate. You may also want to do your homework first and check the going rate on the internet.
When you talk to a lender, make sure that you discuss the closing costs, processing fees, or other costs that are usually not advertised. These are hidden costs that you will discover after you have signed on the dotted line.
Do Not Be Afraid To Ask Questions
You do not want to deal with a lender who does not provide answers to your questions about the loan. Just because you are seeking a loan does not mean that you have to be overwhelmed by the generosity of the lender. Ultimately, you are paying the cost of finance, which is the interest on the loan. Ask all the questions that come to mind. The more questions you ask, the better it is for you.
In addition to the interest rate, amortization, and repayment, make sure that you ask about extra payments. Many lenders do not allow extra monthly payments, but these make a big difference to the overall finance cost, even if you round off the monthly payment to the nearest $100 dollar.
The Mortgage Lender to Avoid
Avoid a mortgage lender who offers pre-qualification at high rates. Pre-approved loans at an amount higher than you can afford may land you in a foreclosure. You want a mortgage lender who has your best interest at heart, is friendly, accommodating, and willing to work with you. A good mortgage lender will take time to understand your challenges.
There will be times when you will need the help of the lender to overcome problems that may surface during the course of paying the mortgage. The best mortgage lender is one who takes you through not only the approval process, but also through difficulties you may face during the loan period.