Buying a home can be one of the biggest decisions you will ever make, but choosing the right mortgage lender can also be huge decision. Be careful. The mortgage lender you pick can affect your future, in either a good way or very negatively. It is important to research mortgage lenders before you buy your home.
The first step is to compare rates. Mortgage rates can vary based on the length of the loan, ensuring lower rates for less years or more affordable payments over an extended period of time. There can also be fees associated with procuring your loan. Of course, it’s best when these fees are minimal or non-existent. The types of loans can vary too. There are balloon mortgages which do not fully amortize over the length of the loan, keeping payments lower at first, but leaving a balance due at the end of the terms. These loans may have fixed or floating interested rates. A safer, more popular way to go in this economy is typically a conventional loan with a fixed interest rate, so that your payment never varies for the life of the loan. When securing a mortgage, you also need to know about points. Points are a type of prepaid interest on a loan. One point is worth one percent of your loan amount. The idea behind points is that you pay more interest up front, and if you keep the loan long enough, over time you can save money.
All of this can be very confusing. A good lender can help guide you through the maze of mortgages and help you figure out how your mortgage payment will best figure into the rest of your financial plan. So, once you find lenders with the best rates and programs for you, it’s time to ask a few more questions. You need a mortgage lender that is not just trying to push his product, but will help qualify you for the loan that works best for you. If you are happy with your bank or credit union, you should include them in part of your research project. Some banks offer incentives to customers such as lower interest rates or discounts on fees. Also, ask those who are knowledgeable in the industry which lenders they suggest.
Arnie Traub, a licensed Realtor with over 16 years of experience, is definitely a professional you can trust to help. If you would like a little guidance in your mortgage lender search, just give him a call at 386-295-2999.