Finding a good mortgage lender for black mountain NC real estate can seem
just as daunting as looking for realtors or trying to find a house to meet your
needs. However, one shouldn’t be offset from the process of finding Rocky Mount NC Real Estate simply
because of a mortgage lender. Before committing to a mortgage lender, there are
a few questions which should be asked. Should any of the answers not leave you
satisfied, then the search should be continued until you feel comfortable.
As you are finding a good mortgage
lender, you will want to understand what loan options are available, and which
one works best for you. Any good mortgage lender for properties will conduct
adequate research on all options before presenting to which one they feel is
best. Some options include fixed-rate loans, as well as adjustable-rate loans,
interest-only loans, as well as negative-amortization loans. No matter which
loan you use, be sure you understand what the interest rates are as well as the
annual percentage rates. The latter is not easily calculated, as it does
include interest rates, lenders fees, all divided by the term of the loan. Have
someone double check the calculation since not all lenders calculate it
correctly. Also, if you have an adjustable loan, there is no way to accurately
compute the rate, so don’t be alarmed. If you pay off some of your loan early,
this is not taken into account for the percentage rate. If you know ahead of
time that you plan on paying off larger portions of the loan, perhaps around
tax season, then ask if that affects your rates and how. For adjustable
interest rate loans, be sure you are informed about the index, margin, highest
rate, adjustment frequency, as well as the maximum annual adjustment.
Next, in finding a good mortgage lender,
you will want to ask about any discount points or origination fees. The loans
work by having each point equal a single percent of the total loan amount.
There are times when a good mortgage lender for properties will alter the
origination fees on top of the points. Points are important because they are
tax deductible and they can lower your interest rate most of the time; if you
pay off more points, then your interest rate will be lowered. Finding a good
mortgage lender for properties does cost more than your time. The additional
fees are not always disclosed to you up front, but bear in mind that some of
the fees could include the appraisal, taxes, a credit report, recording fees,
the lender’s title policy, escrow, or pest inspection reports. The lenders are
legally required to provide for you a total estimate of these fees, entitled
the Good Faith Estimate. Once you have applied for a loan, note that the lender
has three days in which to provide this estimate for you.
Some other questions to ask when finding
a good mortgage lender for properties is whether or not they offer loan rate
locks. This can help you as interest rates will often fluctuate on a daily
basis. Don’t be afraid to ask if there a fee to do this, how long it will last,
and whether you can get it in writing. Be cautious of prepayment penalties.
Some places do not like you paying off a loan prematurely and then being able
to lessen the interest payments. Ask if there are penalties and for how long
they are effective. Make sure to ask how much time is needed to fund the loan.
Often it takes 21 to 45 days. Include the closing date in your contract.
Lastly, ask what the yield spread premium is. This is a commission paid to your
representative from the lender.
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