When you want to purchase a home you usually contact a real estate agent first. They will then put you in contact with a mortgage lender if you haven’t already started working with one. You aren’t ready to buy your first home until you are pre-approved and better yet, pre-qualified. If you want to find the right lender that fits your needs, take a look at these tips below.
How To Choose Your Mortgage Lender
You should talk to at least 3 lenders to compare what they offer you. Get to know the person, interest rates, and the specific loans they can offer. If you need assistance in finding a lender, a real estate agent can help you. You can shop around by looking at the Consumer Financial Protection Bureau.
You have your own unique financial situation as does everyone. You want a lender who can understand your needs and work alongside you for the best fit loan that meets your situation. Experienced lenders have a vast knowledge of different loan types as well as programs available for buyers. One of the biggest factors in getting a home loan is your credit score, so you want to work with someone you are comfortable sharing your personal information.
Lenders are required by law to provide you with a loan estimate form so you are able to take a few of these and compare them to find your best option. There are several types of home loans that can be offered to you and some may be better than others in the long run. Some of these loan types are:
Conventional Fixed-Rate Mortgages
A 30-year conventional fixed-rate loan is the most common type of mortgage loan. The term on these loans is long, so monthly payments are lower, and the fact that rates are fixed means that your interest rate will remain the same throughout the life of the loan.
Adjustable Rate Mortgages
Interest rates can change over the lifetime of this loan. If you choose to obtain an adjustable-rate mortgage, your interest rate will increase or decrease as the market fluctuates after the fixed period expires.
Borrowers who have lower credit scores, incomes, and savings are more likely to qualify for Federal Housing Administration (FHA). FHA loans have lower credit score minimums and down payment requirements than most conventional loans.
VA loans are backed by the U.S. Department of Veteran Affairs, so they’re only available to veterans, active service members, and their surviving spouses.
Overall, the biggest factor in choosing a mortgage lender is finding someone you trust, who can take your situation into account and find what best suits your family’s needs. This is a big decision and is the first step in the home-buying process, so you want to get it right. If you are looking for a lender and would like more information on a home loan, contact me, I am here to help!
More on California Home Loans
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- Is refinancing from an FHA to Conventional a good idea?
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- What You Need to Know About an E-Closing
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- Why Fannie Mae and Freddie Mac Impact Every Mortgage
- Pros and Cons of an FHA Loan