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Secrets Lenders Don’t Want You to
Know!
The
right or wrong decision when signing your home mortgage can mean thousands
of dollars difference in interest paid. There are very important
considerations to evaluate before you commit to a 15 or 30 year note. For
many of us, our mortgage payment is the most important financial decision
we’ll ever make. Doesn’t it make sense to know as much as possible about the
financing of your home? Take the time to thoroughly investigate all of your
options!
Unbelievably, many of us sign the first mortgage that is placed in front of us. Typically, the excitement of the new home purchase reduces the mortgage to
not much more than an afterthought. What you read here could save you
hundreds, or even thousands of dollars. Your real estate professional has
established relationships with the top lenders in your area. By aligning
yourself with a professional agent you ensure that all the financial steps
are taken care of properly and economically.
Utilize a Lender with
Established Ties to an Agent -
Lenders are much more flexible with the real estate agents who have done
business with them previously. This relationship then establishes them as a
team. The lender and agent work effectively together, referring each other
business. That’s why a good agent can make a substantial difference in setting
up the most economical financing. The right financing can, literally,
save you tens of thousands of dollars over the life of your loan!
Don’t Attempt
Paperwork Alone - All the
paperwork required to complete the purchase of a home can be quite
intimidating and frustrating for a home buyer. Make sure you have your
lender help you with all of the paperwork. Get help from your team, your
lender and agent. Their expertise will help alleviate the stress, and it will
prove to be invaluable before you sign your mortgage.
Look at All of Your
Options - Make sure you see at
least 5 loan programs for your mortgage. Lenders have at least 10 programs
and should work with you and your agent on deciding what is best for your
circumstances. Evaluate all of your options. After all, it’s your money you’re
spending - not theirs!
Demand Service -
There is little difference between a bank, savings and loan, or a mortgage
broker when it comes to the competitiveness of their loan rates. The
difference is in the service they provide. It is their job to serve you! You
want to get the loan approved and move into your new home as quickly as
possible, but don’t overlook the fact that you are the one spending the
money and they are the ones who should cater to your needs. Don’t let the
process become so intimidating that you lose that understanding.
Stay in Complete Touch
- You should receive a written
report from your lender about every step. This will ensure that no details
are overlooked and there will be no surprises.
Negotiate a Flexible
Loan - Don’t just accept the
terms they lay down in front of you. Lenders are in the business of loaning
money and they want your business. Make sure you examine every option
available to you. If you negotiate a variable rate loan, many lenders have
the ability to move you into a fixed loan if rates start going up. Make sure
that you understand whether or not that is an option in the package you are
looking at.
Don’t Give Up on the
First No - Initial decisions are
not always final decisions. Going to a higher authority can sometimes get
you the loan, but do so with the assistance and compliance of your lender
and agent. Many times special circumstances, when explained properly to the
person in charge, will win you the loan.
Don’t Wait for the
Bottom of the Market - The odds
of you hitting the bottom of your market are similar to the odds of you
winning Powerball this weekend. You will almost never hit the bottom of a market,
and trying to time it exactly right is often costly. It usually causes a
person or family to miss out on the opportunity to purchase a very nice
property. You’re better off simply negotiating the best rate and terms you
can at the time you find a property. If interest rates go down, you can
always
refinance. This is a much better approach because you won’t miss out on the
property you’ve spent so much time trying to find.
Be Honest With Your
Lender - Your lender wants to
help you with your loan. The only time they get paid is when you get
approved. The more information (good or bad) you provide your lender, the
easier it will be for them to get an approval. It helps them present the
loan in the best light. This in turn helps the loan get the highest approval
rating.
Become Completely
Educated - Pick your lender’s
brain. Lenders will teach you all about your various options, even if you
haven’t found the right property yet. They will be very patient with you
while you are looking, especially if you have aligned yourself with the
right agent. They understand all the up-front work will pay off in future
business. Your agent will then continue to refer people to the
courteous and service-minded lender in the future.
Get Pre-approved -
Lenders will provide you with a pre-approval letter. By getting
pre-approved, you know exactly what financial parameters to stay within. Your agent and lender will consult with you and help you get approved for
the loan that best fits your needs. Many times, they are able to get you a
larger loan than you may have thought possible.
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