3 Rules to Remember when Shopping for a Mortgage
If you are in the market for a new home, you’re probably in the market for a mortgage. Here are 3 critical shopping tips for anyone looking for a new loan.
1. Know the Terms
All the terms of a loan matter! Unfortunately, shopping for a mortgage is not as simple as finding out how much a lender will let you borrow and at what interest rate. You’ll want to get a complete breakdown of what the offer you receive means to you on a monthly basis as well as how much money you’ll be spending over the life of the loan. This information could greatly affect your purchasing power.
2. Not all Mortgages are the Same
There are several mortgage types available to residential home buyers. Most people will shop for a traditional fixed rate mortgage, but other options are available including adjustable rate loans (ARMs), Federal Housing Administration loans (FHAs), and Veterans` Administration loans (VA). Ask about each loan and if you qualify for it. And, you’ll want to be sure to understand completely what kind of loan your lender is offering you.
3. Fees, Fees, Fees
Most loans have fees associated with them in addition to the principal amount you’ve borrowed to buy your home. You can sometimes borrow the money need to cover the fees associated with the loan, but that will obviously increase the overall amount of debt you undertake. Some fees are paid up front and others are not due until closing. Knowing what fees you will be required to pay, how to pay them and when they are due will definitely require some questions and processing.
If you would like to chat more with me about how to shop for a mortgage and what other questions you can ask lenders in order to find the best deal, feel free to call me at 860-416-2085. I’m happy to get you started on the right path so we can help you find the right home with the best mortgage for you!