There’s no doubt today’s housing market is very different than the frenzied one from the…
When you’re ready to buy a home, the number one job you have is to ensure you put in the work to find the best mortgage lender on the market to meet your needs. No two mortgage lenders are built the same, as each one may have its own tailored and specialized service along with differing rates. To find the right team for you, be prepared to ask all the right questions along with the answers you want to hear.
This blog will help you determine important questions you should ask every potential mortgage lender before moving forward with the buying process. Of course, no lender may check every single box, but at least you will have a good idea of which one fits your budget and lifestyle the best. Let’s take a look at a few of these questions.
Do You Have Rate Locks
Rate locks are the most important part of your mortgage process. A rate lock is a type of insurance that guarantees you receive an interest rate for a set period of time (typically, six months). If rates go up during this time frame and you want to refinance or take out more money from the equity in your home, then it’s possible with a properly locked-in rate.
Are There Any Additional Fees?
If you need a mortgage lender, be sure to ask about any additional fees they may charge. Some lenders offer free services such as document preparation and credit checks, while others have an out-of-pocket cost for these items. We recommend first asking questions like “What are your typical closing costs? What is the fee I will owe if my loan gets declined due to lack of income or poor credit scores? Where will this money come from?” These types of questions can help give you a good idea of what you should expect when you go through the process with that particular company.
Can You Send Documents Electronically?
In most situations, you’re going to be dealing with a lot of paperwork. This can really hamper the processing time and make the process a lot longer than anticipated. Someone has to go through all your paperwork and make sure every “I” is dotted, and every “T” is crossed. One question you should ask is whether or not they accept documents electronically. This will make the process faster and more convenient for you as well.
Is My Credit Score Required?
If this interests you or concerns you, be sure to ask about their requirements when it comes to evaluating an individual’s credit score during the loan process! itsIf your credit score is between 680-720, then a lender may not require this information from you. However, if it falls below 580, they most likely will need to see one before even beginning to work with you on a mortgage application.
What Loan Types Do You Have?
Some mortgage lenders only handle certain types of loans, while others carry as many as they can. You might be inclined to go with a specialized lender who offers the type of loan that interests you the most. Or, you might go with a lender that has a variety of options at its disposal.
Also, be sure to ask them about their lending authority. If they have the ability to lend in your area, then the chances are good that they can lend on the type of property you want to purchase. On the other hand, if they aren’t authorized to handle mortgages there or aren’t authorized to offer the type of loan you want, they don’t qualify as good lenders.
Will You Sell My Loan?
Sometimes, lenders are in the business of taking on your loan, only to sell it to other lenders for a price. This can be true if you’re shopping for a mortgage lender or if you’re looking for someone to refinance with. In some cases, lenders will try to sell your loan because they know that they can make more off of it than they can by simply keeping it in their own portfolios.
You should consider declining the loan if you don’t want to lose your loan and sell its requirements to someone else. Be clear with the lender about whether or not you’re willing to sell your loan so that they can decide between taking on your mortgage or moving on to another prospect who doesn’t mind selling their loan down the line.
Don’t Be Afraid to Ask Questions
In the end, you shouldn’t be afraid of asking the lender any other questions that might come to mind. There are no bad questions, especially if you’re feeling your way through the process. Not everyone is fully up on all the laws and regulations, so asking about fees and whether your rate can be locked in is only for your benefit. Whatever you do, don’t put off this process and don’t settle.
The last thing you want to do is be stuck with unsatisfactory terms for the next several decades of your life because you didn’t want to take the time to do research. There are literally hundreds of other lenders who may be willing to offer you exactly what you want. When in doubt about what kind of lender to work with, ask your friends if they can recommend someone or ask a real estate agent for a referral. At the end of the day, you can always visit https://www.primemortgage.com/ to learn more about the lending process.
555 Anton Blvd Ste 150
Costa Mesa California 92626