Choose the Best Mortgage Lender with the Help of These Five Tips
Wouldn’t it be great if finding the best mortgage lender was as easy as opening an app?
Unfortunately, it isn’t that easy because there are a lot of moving parts. Taking shortcuts when choosing a lender could leave you with high monthly mortgage payments. Instead, it is best to consider the following tips that Brian McCauley and his team have suggested:
1. Consider Your Budget
The first thing to know when looking for the best mortgage lender is how much property you can afford. Any mortgage lender can offer you a loan but if someone doesn’t consider your whole budget, they can easily max you out. If that happens, there’s no room for unexpected expenses (and they WILL happen!).
You’ve probably heard of getting a loan pre approved. Lenders will approve a loan amount before you buy a home based on your gross income, revolving debt, and outstanding loans. However, they don’t consider other monthly bills, like groceries, insurance, daycare, gas, and utilities, in their calculations. As you know, these things can add up!
In order for you to get an accurate estimate of what you can responsibly afford, be sure to factor in those expenses and your financial goals. Write all of these “extras” down, add them up and then subtract that number from your monthly income. You’ll want your mortgage payment to be less than what’s left.
2. Compare Rates of Different Lenders
When shopping for a loan, the lender will let you know what interest rates you’ll qualify for, based on your credit score and other factors. Not happy? You have every right to shop around, even with something as large as a home mortgage. For example, you can get great rates from a home mortgage company in Dallas TX that offers different kinds of loans. Once you have a list of the different loan amounts and their interest rates, you can narrow things down.
3. Look at the Types of Mortgage
There are a lot of different types of mortgages and none is superior to another. Since multiple programs could work for you, discussing the different options with your mortgage lender is important. Be sure to inquire about the following kinds of the mortgage from your lender to see if you qualify:
- Adjustable rate mortgage
- Conventional fixed-rate mortgage
- VA loans
- FHA loans
4. Check the Credit Score
Like it or not, your credit score is among one of the most important factors that lenders consider when offering loans. A higher credit score means you will have a greater chance of getting a mortgage with a better interest rate. That doesn’t mean that you need a high credit score to qualify for a mortgage, but you do have limitations on your rate. Again, you can shop around.
5. Ask for Recommendations
Do you know someone who has recently bought a home? Don’t be afraid to ask friends, family, or colleagues if they think their lender is the best mortgage lender around! Another great resource for finding the best mortgage lender for you is to ask your real estate agent. They have a lot of contacts and have worked with a variety of lenders.
In a Nutshell!
Finding the best mortgage lender doesn’t have to be difficult. The interest rate is important, but don’t forget about other factors, like lender fees, your personal plans, APR, and closing costs. A good lender will work with you to figure out how to get you into the home that’s the best fit for your finances.
More to Read: