Financing
For most home buyers, shopping for
a home also includes shopping for a home mortgage. In both of these activities,
you must be a smart buyer to ensure the greatest possible profit. Working
with a knowledgeable and friendly real estate agent will ensure that you can
find the house you love, but rarely does anyone love their mortgage payment.
The following are seven secrets New
Choice Realty would like to share with you to improve your ability to find
the right financing package, so that you can enjoy the home you love, without
paying too much for too long.
Quick
loan processing
Some lenders offer approval in 5 to
7 business days, while others use electronic underwriting to give approval
in the same day. Most traditional lenders take much longer to approve a loan.
Be sure to ask how long your lender takes to ensure approval of funds. This
could get you to settlement sooner, making you more attractive to sellers
than those who will require longer periods to be approved. This could also
ensure that you spend less time in temporary housing, which sometimes results
from extended approval delays.
Mortgage
pre-approval
We cannot stress the importance and
convenience of pre-approval too much. A no-cost, no-obligation pre-approval
before you start house hunting can save you a great deal of time. Sellers
will know you are ensured the money to buy their property, which may lead
to your offer being favored over other, unknown and unapproved buyers. Remember,
pre-approval is not the same as “pre-qualification” which only gives
a rough idea of how much you can afford to spend. Pre-approval ensures that
you can get the necessary funds without going through the entire loan process
after you have made an offer.
Teamwork
pays
Every home purchase requires an effective
team of a buyer, a real estate agent, and a mortgage lender. Work together
with your real estate agent who specializes in your area to find the home
that is right for you. Then team up with your lender to make sure your loan
maximizes your buying power and is the right loan for your needs. Use your
buying team to get the best deal for yourself.
Negotiable
loan fees
Shop around for a lender whose fees
are reasonable. Ask your lender about all the charges, such as the “commitment
fee” or the “underwriting fee” or the “processing fee.”
Mortgage lending is a competitive business, and some lenders will negotiate
fees to get your business. All of this shopping around can save buyers a great
deal of money in the end.
Rate-lock
options
Find out from your lender what rate-locking
options are available. The shorter the lock time – that is, the shorter
time between when you agree on a mortgage rate and when you actually go to
settlement – the lower the interest rate you will have to pay.
Variety
of mortgage products
For some, a short-term mortgage is
the way to go, while for others, an adjustable-rate loan is best. Find a lender
who offers a wide selection of mortgages or even unique mortgage products
which best suit your individual needs. Variety is the spice of life, and it
can benefit buyers though lower payments or whatever option best fits your
needs.
Flexible
underwriting guidlines
Greater flexibility in the underwriting
process may make you eligible for the home you want when less flexibility
may exclude you from the home of your dreams. For example, some underwriters
count the earnings of a spouse who does not yet have a job in the new location,
but has a steady work history over several years. This flexibility can make
the difference between the home of your dreams and just another house.
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