When you want to buy a home, you invest in it for the long term. On average, a standard mortgage usually ranges from between 10 to 30 years hence it’s undoubtedly a smart move to shop around for the best mortgage lenders in the market.
How to look for mortgage lenders – Check your credit score
A high score portrays the finance ability of a client to make timely payments hence they have more bargaining power to negotiate a better personal loan with the lending financial institutions. In addition to this, knowledge of the market is vital as one is shopping for a lender.
Different lenders offer different market rates on mortgage hence its advisable to look for a lender who best suits a client’s needs. Interest rates may be fixed meaning you will be paying the same throughout the life or adjustable where its pegged on a percentage and may be subject to increments.
Mortgage Preapprovals
It is a letter from a lender which indicates how much credit one can qualify for. The following are some of the requirements that one needs to get preapproved:
- Social security number.
- Bank account information.
- Outstanding debt obligation for example car loans, student loans.
- Tax returns and salary or employer information.
A mortgage preapproval proves to the seller that a lender has looked into your finances and has given a recommendation on the creditworthiness.
Read the fine print and ask the right questions.
Settling on the right lender can be quite a challenge. You can narrow your choice by seeking referrals from family, friends or reading online reviews. Ones you get some names get out there and ask questions such as:
- How much down payment required?
- How long is the turnaround time for appraisals and final closing?
- Under what circumstances will the earnest money be kept?
Importantly, look at the fine print on the loan documents. It will inform you of the closing costs, home inspection contingency fee and other details of high importance.