Securing the loan can be one of the most exasperating elements of buying a home. But it doesn’t have to be. I have close business relationships with several lending companies in the Valley, and they’ve helped me realize a few things that will make the process of applying for a loan very manageable.
1 . Create a list of questions regarding your loan program
Be sure to have a list of questions if you find that you don’t totally understand the advantages and disadvantages of all the different programs. One of my lender contacts or I will help you understand the advantages and disadvantages of each program, because it’s hard to know the distinctions between both fixed and adjustable rate mortgages.
2 – Decide when to lock
When you lock in the interest rate, it designates that a mortgage lender holds to the mortgage interest rates for the loan – most often at the time the loan application is received. By floating the rate, you can lock the rate at any time between the day you apply for your loan and issuance of closing documents. Buyers who choose to float presume that interest rates will drop in the near future. Click here to see the outlook for the next 90 days of interest rates.
3 – Determine if you want to pay additional points to decrease your interest rate
When you choose to pay additional points to lower the rate of your loan, you’ll pay for them in cash at the time of closing. Each point is 1 percent of the loan.
4 – Gather your paperwork
Getting a loan requires a lot of paperwork, so you should take some time to get all your documentation together.