Things to Consider When Choosing a Mortgage

Although interest rates are important when choosing a mortgage that is right for you, there are other important considerations that need to be taken into account. It is very important that you work with a broker that is knowledgeable and able to stay on top of all the different aspects that are part of the loan process.

Missing the Closing Date can Cost:

Once a house goes into escrow there are three main steps that need to occur for closing in good time without delays. They are in order:

  1. Loan is Approved
  2. Appraisal Report is satisfactory to the Lender and
  3. Loan is finalized and Documents prepared and sent to Escrow for signing, recording and funding.

Missing any steps or if any step takes too long so that the step after is postponed could mean that the transaction gets postponed past its closing date. This could mean that you may have to renegotiate the purchase, lose earnest money or worse the sellers pulling out of the transaction and selling the property to someone else. Not only is this stressful but it puts you at the mercy of the seller.

Rate Lock Expires:

Another way that not working with the right broker can cost you is if your broker is “sloppy” or not on top of things causing delay in processing. This could cause your interest rate lock to expire. This can also happen if you are not proactive in supplying all the information needed by the broker in a timely fashion. A good broker will stay on top of everything to ensure that the process is moving and will know which lenders to not send loans to as they have a reputation for being “slow”. If the interest rate lock expires in order to get the rate you may have to pay additional points.

Low Interest Rates

You may choose a lender based on the low interest rates that they quote you on the initial phone call but that may not be the rate that you get! It is important to be aware that interest rates offered by the Lender on the Mortgage will be based on the information that you submit with the loan. Any deviation from the information that was used to price the loan at the time of the call will change the rate.

Mortgage Brokers and Mortgage Loan Lenders make their money from commissions on the loans that they place. So they are going to get as many loans as they can to make their bottom line as high as possible. Having a lot of loans on their pipeline means that they have little time to spend on each loan. Ever wondered why some brokers take so long to get back to you?

It is thus extremely important that you work with a reputable broker who is experienced and professional.

For more information, contact out knowledgeable brokers at Loan People USA.


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