Finding a good mortgage lender is more important than most people realize. While you might be eager to get approved by any provider that will accept your application, this could come back to bite you over the course of your mortgage, if the terms of the agreement aren’t all that favourable from your perspective.
There are a few ways to narrow down the field to just a single, well-chosen lender, as well as other things to keep in mind on your search, so stick around and we’ll guide you through this thorny issue.
Four Tips for Choosing a Trustworthy Mortgage Lender
There are quite a few elements to get right when you’re on the hunt for a mortgage lender worth working with.
First of all, make sure that your lender is licensed and in good standing with their state regulatory agency or national watchdog organizations like the Better Business Bureau (BBB). You should also check online reviews from past customers on sites such as Yelp! or Google Reviews to gauge customer satisfaction levels.
Secondly, compare lenders by looking at loan terms offered, including interest rates that apply, fees that are charged, closing costs associated with each loan type, any early repayment penalties that are included, and other important factors so that you get the best deal possible.
Be sure to ask about any special programs they may have available too. Many lenders offer discounted rates for first-time buyers or veterans, for example.
Thirdly, make sure that your potential lender is willing to take the time to answer all of your questions and explain their products clearly. Don’t be afraid to ask for clarification if you don’t understand something, because the most trusted mortgage lender available will never rush or pressure you into making a decision.
Finally, before signing on the dotted line, read through the loan documents thoroughly and make sure everything looks correct. Ask yourself: do I feel comfortable with this agreement? Am I getting what was promised? If not, it may be wise to look elsewhere for a different mortgage option.
By following these four tips, you can rest assured that finding a trustworthy mortgage lender will become much easier.
Comparing Different Types Of Mortgages: Finding The Right Fit
When it comes to finding the right mortgage for your needs, it’s not just about the lender you go with. From fixed-rate mortgages to adjustable-rate and interest-only loans, there are a multitude of packages out there, and so it can be hard to know which one is best for you. Here’s a brief overview of some popular types of mortgages that might fit your situation.
- Fixed Rate Mortgage – This type of loan has an unchanging interest rate over the life of the loan and offers peace of mind in knowing exactly what each payment will be from month to month or year after year, which is good for budgeting purposes. It could also mean lower monthly payments if rates decrease during this time period as well.
- Adjustable Rate Mortgage (ARM) – An ARM typically starts off with a low introductory “teaser” rate, followed by periodic adjustments up or down depending on current market conditions. This often results in lower initial payments, but potentially higher ones later on down the road, so make sure to read the fine print.
- Interest-Only Mortgage – This type of loan allows borrowers to only make payments on the interest portion of their mortgage for a set period, and then switch back to paying off both principal and interest at a predetermined point in the future. It’s great if you need short-term relief from high monthly payments, but can be risky since your balance won’t decrease until after that time is up.
The Bottom Line
By taking some time to research different lenders, as well as the types of mortgages available, you will have more confidence in finding the right one for your needs, and which you can trust.