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Ask the right
questions:
What are the qualifying
guidelines for the particular loan? These might relate to your
income, employment, assets and liabilities, and credit history.
What is the minimum down
payment? Different interest rates, loan terms, and private mortgage
insurance are based on your down payment. Some programs require 20
percent down payment. There are special low down payment programs
available if you qualify.
What is the annual
percentage rate of the mortgage interest? The APR of the
mortgage interest is generally higher than the initial quoted rate
because it includes all lenders' fees.
What points
or origination fees are applied, if any? Points are prepaid mortgage
interest, and you may have to pay points at closing in order to get a
lower interest rate on your mortgage loan.
Can I lock
in the interest rate? The interest rate of the mortgage you're
applying for may go up or down before you close on the home. Be sure to
ask the lender if there is any fee for locking in the rate and whether
you also can lock in points.
What is the 'good
faith estimate' of closing costs? Mortgages can come with a list of
fees. Ask for a list of estimated closing costs before applying for a
loan.
What are the upfront
costs? Some fees may be required up front, such as the credit report,
property appraisal and loan application fee.
Is there a prepayment
penalty on the loan? Ask about the duration of any penalty period
and how the fee would be calculated. This is important if you think you
will sell your home before the mortgage is paid off, which most
homeowners do.
You may think of other
questions as you work with your mortgage broker. The important
thing is to ask the same question concerning each mortgage program so
you get a good comparison of total cost over the life of your
loan. Print this web page -- there's room to write in the
answers, making it easy for you to compare mortgage rates the smart way!
Contact the premier mortgage
brokers who advertise in the LoanStar.net
Mortgage Directory. You will discover experienced,
knowledgeable professionals who truly believe that every borrower
deserves personal attention and the highest level of customer service. |
