Finding the right mortgage lender means having the best financial help in buying a home. Of course, you don’t want to go wrong with money talks, do you? The problem is, there are many lenders in the real estate market today. That can make your search quite confusing especially if you’re a first-time homebuyer.
Avoid the Pitfalls of finding a Mortgage Lender through these Tips
Yes, finding a lender seems difficult. But you only need to learn a few points to make your search easier. Hence, jot down these tips as a guide:
Pump-up your Credit Scores
Your credit score tells if a lender can trust you or not. If you have a high credit score, it shows you don’t have any debt trouble history. That makes the lender trust you, which is a good leverage to negotiate for a bigger loan and lower interest rates. And having a low credit score tells otherwise.
Pay all your major loans, credit cards, and other debts for at least 6 months before applying for a loan. Also, be sure not to make any big loan between pre-approval and closing to keep your credit scores intact.
Search for Options
When you’re ready, start finding trusty lenders in your local place. Ask your friends and acquaintances for recommendations, but it’s best to ask your realtor about it. Also, note that there are different types of lenders to choose from. For example, mortgage bankers would lend you cash depending on the rules and standards of their financial company. On the other hand, a correspondent mortgage lender will borrow cash for them to lend you but usually has loose standards.
Make asking the right Questions a Habit
It’s wise to ask the right question to lenders before you get your mortgage. Some of the best questions include:
- “What are the fees should I prepare?” This can yield your answers such as closing costs, loan origination, and transaction fees among others.
- “Are these fees covered by the mortgage loan?”
- “How long should I wait for your pre-qualification, pre-approval, appraisal and closing processes?”
- “How much down payment should I prepare?”
- “How do you keep in touch with clients?”
These are only a few of the vital questions to ask. Ask your realtor for a guide.
Go for Pre-Approval
Yes, getting pre-approved places you in a good position to negotiate for a home. It makes the seller see you as a serious buyer. But pre-approval is also helpful for you to gauge one lender to another.
Consider getting pre-approval from two or more lenders. It allows you to know which lender gives the best loan offer to you. Be sure, however, to prepare vital requirements before you go for pre-approval, such as bank statements, social security numbers, and income information among other documents.
Carefully compare Lenders
After getting your pre-approval, you can easily compare one loan offer to another. This means you can choose one that fits your needs. Get copies of quotes from the lenders, then use online mortgage calculators. This helps you accurately compute principal, interest rates and other points.
Take note of these tips so you can find the right mortgage lender to trust today. Build your credit scores, gather lending options, ask the right queries, get pre-approved and compare mortgage loan quotes for the best choice. That’s when you can get good help in buying the home of your dreams!
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