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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 our home? Take the time to
thoroughly investigate all of your options!
Unbelievably, many of us sign the first mortgage 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 substantial difference in
setting up the most economical financing. And 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 lenders help you
with all 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 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 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 about like the odds of you hitting your state
lotto! 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
refinance. This is a much better approach because
you won’t miss out on the property you’ve spent
so much time locating.
- 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 on down the line.
- Get Prequalified - Lenders will provide you
with a certificate of pre-qualification. By getting
prequalified you know exactly what financial
parameters to stay within. Your agent and lender
will consult with you and help you get qualified 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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