3 Mortgage Shopping Must Do’s
Mortgage Shopping: Don’t Settle
If you are in the market for a new home, you need to ensure when you are Mortgage Shopping you do a few things to prevent selling yourself short on your new loan. You need to be educated and make smart decisions that will be beneficial over the course of the loan. I see people do this all the time and have witnessed too many people leave many important decisions with the first lender they come across when this could be the worst thing for you to do. What I also see from a lot of buyers who don’t come to me for a loan is that they didn’t take the time to get the absolute best loan possible. Yes there is a method to this madness, but it is something you need to consider
Mortgage Shopping: Credit Score
One of the most important things you can do before shopping for a mortgage is pulling your credit history report and obtaining your credit score. Obviously the rule of thumb is always the high the credit score the better, but as long as you are 500+ FICO with an ample down payment you can get an FHA Loan and if you have 620+ FICO you can get a conventional loan. If you don’t do your homework while mortgage shopping and you are just looking for the lowest interest rate, you may be surprised that after you apply for a loan you get an interest rate substantially higher than your desired rate. This could be due to the fact that your credit score was lower than you anticipated. Taking a deep dive into your credit history and credit score factors can go a long way in your preparation for a home loan.
Mortgage Shopping: Accepting Too Early
As we touched on earlier and will touch on here is the mistake of going with the first lender who gives you a mortgage quote. You have to treat the home loan process as you would the car buying process. Just because the finance manager gives you a 9% interest rate doesn’t mean that you should settle for that. The same applies when mortgage shopping as well. If you are under the misconception that shopping for a loan will damage your credit, you are mistaken as the inquiries made in a month’s timeframe will all be counted as one inquiry. Credit bureaus have adopted this policy so your credit score doesn’t suffer during your credit and mortgage shopping.
Mortgage Shopping: Loan Type
The last important item to be informed on is the type of loan you are going to be getting and the financial ramifications throughout the course of the loan. While mortgage shopping you need to determine what your goals are for the home and how much of a monthly payment you can handle. This will guide you towards a Fixed-rate 15 or 30 year loan or an adjustable-rate-mortgage. Making the wrong decision here can wind up costing you thousands of dollars rather quickly. Also, if you can get approved on a VA Loan or a USDA Loan you can also take advantages of using these programs as well.
Mortgage Shopping can be a tough task for someone who isn’t educated on how to properly secure the best rate possible. Here at www.loanconsultants.org we will strive to get you the absolute best rate possible and put you in a loan that is right for you. Call me anytime to go over your options at 888-900-1020 or email me at email@example.com.