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| Ask the right questions
before signing a mortgage |
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One of the biggest decisions you’ll
make is when you sign a mortgage. But before you sign
the mortgage, there are a few important questions you
should ask your
mortgage lender, so that you do not end up with unwanted
surprises.
In the article, “Signing a Mortgage? Ask the Right
Questions First!” released on affordableconcretecutting.com,
the writer provides essential questions you should ask
your lender before signing any mortgage documents.
Answers to these questions may change your mind as to
which
mortgage you should sign for. If they do not change
your mind, they will further support your confidence that
you are making the right decision.
The first thing you will want to know is how long the
mortgage application will take. It usually takes 45 to
60 days. Sometimes it may take only 30 days and sometimes
much longer.
Next, you will want to know what documents you will need
to process
the mortgage. “A certificate that verifies your
total income and your assets will be necessary to get
a home mortgage loan. However, lenders ask for different
documents, so it depends on which lender you choose.”
You should know how much your down payment will affect
your mortgage loan. “First, finalize the down payment
amount on your home mortgage loan. Based on this your
lender can offer you a range of interest rates, loan terms
and perhaps even not require private mortgage insurance.
While some loans demand a 20 percent down payment; others
are much lower than that.”
One of the most important things you will want to know
is the how
much mortgage interest you should expect to pay. Ask
your lender for their annual percentage rate (APR), do
the same for at least two other lenders, and compare.
The next question you should ask your lender is about
the expected amount of origination fees. “Origination
fees are usually paid as prepaid mortgage interest on
your entire home mortgage loan. Your lender could ask
you to pay this in points at closing time just so that
you get a lower interest rate on your home mortgage loan.”
You should ask if the interest rate can be locked-in at
any time during the application process. You may be charged
fees to lock-in an interest rate, but if it is an available
option, you should do it.
Even if interest rates stay the same or even drop, you
would be paying for piece of mind, because if the rates
rose and you were not locked-in, you would end up paying
thousands more on your mortgage.
“Are there prepayment penalties on the mortgage?
This is an important matter for mortgage home loan shoppers
to consider. You need to know the duration of the penalty
period and how the prepayment fee will be calculated.
While some prepayment penalties stand at only one percent
of the loan amount, others aren't as easily calculated.”
Finally, you should ask if you should expect delays during
the approval stage. Incorrect or missing information could
significantly delay the process.
These are just basic questions to ask. But you may be
surprised to find that the answers you receive will lead
to other questions and maybe lead you to a different lender. |
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