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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