If you are looking forward to buying a house, chances are that you are also in need of a mortgage lender. With the deluge of mortgage brokers, both online and offline, it often becomes too difficult a decision to pin down a lender who will give the most value out of your deal. Given that buying a house is one of the most expensive investments we make, it is obligatory that we choose the right mortgage company for our purposes.
Listed below are a few suggestions on how you can select a suitable mortgage lender.
Your Credit Score
You must search for a lender who will assist you in improving your credit score, especially if you don’t have a high three digit credit score. If you do happen to have a high credit score, the interest levied is much lower. However, improving your credit score is a long, arduous task and should be done with care. A good lender will be of massive assistance in helping you generate a good credit score and make sure that you get the most out of your mortgage application.
Do Your Research
No two lenders are alike- each lender will yield different results for you. However, the multitude of choices might be a little too overwhelming for you. Make sure that you thoroughly research the mortgage lender’s profile before you settle down with them. The parameters of differences vary from banks, credit unions (which have the provisions of lower rates), correspondent lenders (they are lenders who fund home loans in their name, selling the loans to bigger mortgage lender once the loan closes), and the like. It is advisable that you go through their ratings online (like in third party sites like Better Business Bureau) to gain a high ground about their customer services and success rates.
Compare Different Rates
Settling on the lowest possible rate is not as advantageous as you might think. You must keep in mind that no lender can irrefutably guarantee a rate. They would have to first run a credit check and investigate into all the details present in your application. Following that, there will be the consideration of closing costs, which enables lenders to make a quick amount of money. These costs have to be reviewed and scrutinized meticulously as sometimes, these lower interest rates come at a price for higher origination fees.
Get a Pre-Approval Letter
You must make sure to get a pre-approval letter before you choose a mortgage dealer, as it will give you an upper hand over the other potential customers who wish to buy the same house. The letter is a verified document of your credit, income, savings, etc. As the name stands, it will also certify you as competent to buy a house, not to mention that it will enable you to determine your position in getting a mortgage. A reliable mortgage lender will help you make a plan and assist you in this step fully.
Mode of Payment and Application Process
Make sure that you have clarified all doubts regarding the mode of payment before you confirm your mortgage lender service. Work out the most suitable plan for yourself. Also inquire the process that will ensue if you want to change to another lender while also determining the exit fees. And finally, choose a lender whose application process is fast and receptive so that you can get your deals at the earliest.