Posted by Stateline Funding Corp.
In a newsletter we mailed to our clients, we provided 4 questions to ask your mortgage lender before signing their documents. These are the basic questions that help you determine if you are working with the right lender.
If you’re going to live in your new home for less than five years, you may want to consider an adjustable rate mortgage or “ARM.” With an ARM your payments will be lower, but they will go up according to the terms of the loan. If you’re going to live in your new home for over five years, a traditional fixed-rate mortgage may be a better plan.
With whatever lender you choose, you should have the ability to have multiple options to fit your lending needs. If you are a first time home buyer and need down payment assistance, be sure to ask your lender what down payment programs are available. The most popular is the 3.5% down payment with the FHA loan. An experienced lender will give you options to discuss what will be in your best interest.
2. Do you offer written mortgage pre-approvals, not just pre-qualifications?
A pre-qualification is usually a Lender’s opinion of your eligibility for a loan. If you ask to be pre-approved, the lender will actually submit your job and credit history to an underwriter and get a conditional approval for a loan and a loan commitment. The advantage of having a pre-approval is that it will make your offer to buy a home stronger and it will usually allow you to close on the home faster.
At Stateline Funding Corp., we issue pre-approvals. We never let our buyers make offers without have the guarantee that they qualify for the loan.
3. Do you have the ability to handle difficult credit history?
Many Lenders will only work with you if you have perfect credit, and if a problem comes up, they won’t help you. Make sure your lender has reviewed and received approval for you and your specific credit history.
If you have credit issues, ask your lender what steps you need to take in order to be qualified to purchase a home. If they give you steps, make sure you follow them so you can be able to purchase sooner than later.
4. Is the rate you quoted me the rate I’ll get at closing?
Many Lenders advertise their rates in the paper and in homes magazines. These are called “teaser rates” in the industry. The name says it all. After they’ve got you committed to using them, many lenders then tell you what the “real” rate will be. By this time, it’s too late for you to do anything about it.
This happens all the time in our industry. At Stateline Funding Corp. we monitor real time rates. We are able to understand what affects the interest rates and changes them on a daily, even hourly basis. We have even had prospective clients experience this teaser with other company’s, but they are too involved in the process to back out.
We always deliver on whatever we promise. We are not in the industry to manipulate home buyers, we are here to help. You should be working with a mortgage lender that cares about you as an individual, not a number.
So remember as you are looking for a mortgage lender to ask these 4 important questions before you begin the process.