When one is researching and interviewing candidates from whom to secure a home mortgage loan, it’s wise to look further than the indicative numbers of who’s got the lowest interest rates. One must also determine the number of points charged and the amount of closing fees, which can certainly add up. It is also extremely important to work with a lender whose staff offers you knowledgeable, prompt, professional and courteous service. If an institution’s claim sounds too good to be true, it probably is. Research a number of lending agencies, shop around, and trust your instincts.

If the interest rate that your lender offers is well below that of the current market, find out how and why he can make such an offer. In today’s information-rich environment, most lenders offer competitive rates. If, conversely, your lender doesn’t match the rate that you have been offered elsewhere, but you like the lender, try to negotiate a lower interest rate. Explain that you’re determined to meet or beat your previous offer. You might be surprised how far the lender is willing to go to secure your mortgages; after all, compromising is how a lender meets their quota and makes top dollar.

Sources of Mortgage Loans

After you choose the best mortgage lender for your needs, consider the different intermediary sources for mortgage loans:

• Builders and Developers – For those purchasing newly constructed or specially designed homes, you may be able to finance your mortgage directly through the builder or developer. This one step option lets you buy and finance all at once.

• Credit Unions –If your company operates a Credit Union, open an account and check out their home financing options. Looking for a Credit Union can be a good source for securing your mortgage since interest rates may be lower for members; plus it gives you something to show off your finance savvy shrewdness to lesser co-workers.

• Government agencies – Just as a conventional loan is backed by a banking institution, a government-backed loan is backed by the Federal Government. Our U.S. government does not actually issue mortgage loans, however they do insure that loans will be paid off. br />
• Mortgage Bankers – A mortgage banker both begins and closes on mortgages. After you have closed, the same company can police your account and make sure you pay the piper.

• Mortgage brokers – A mortgage broker acts more as a mediator. The broker surveys the loan application, wets the ink, processes the paperwork, and submits the loan to the lender. The lender then underwrites and “closes” on the loan and puts it in writing. Brokers often work with a number of lenders that purchase loans on this secondary market.

Questions To Ask Your Lender

What are some of the questions that I should ask any potential lender?
• You will want to ask your lender what kinds of loans are available. Does the lender offer both fixed and Adjustable Rate Mortgages (ARM)? What other types of loans does he offer?

• How many points are required to obtain a certain mortgage rate and, if you want to pay fewer points, how much will your interest rate increase?

• What application fees are charged? Are these subject to negotiation?

• What is the current mortgage interest rate for a 30-year fixed-rate loan? Check the Internet or newspaper to make sure what you’ve selected is competitive.

• Does your loan require premium mortgage insurance; if so, for how long?



• Are you allowed to prepay your mortgage without penalties?

• Are you able to lock in the interest rate, securing that fluctuation of the economy won’t interfere? When is said rate locked in– at the time of the loan application or at the loan approval? How long are you insured that this rate will last?

• Who should you call if and when you have questions or problems?

• What is the estimated processing time to secure the mortgage loan? If the lender seems to be moving slowly on your mortgage, there may be a critical problem.

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