Mortgage Loan Success is in the Details

House hunting for the home of your desires can be exciting. The same can't be said when it comes to finding the financing for it. There are a lot of issues you need to be aware of and understand.

Beautiful pre-approval. To keep your blood pressure under control, it is always best to get pre-approved for a loan. The lender will guarantee your approval for the loan for a period of 30 to 60 days, giving you the time to shop for a home and close on it.


Honeymoons are great things, right? Well, not in mortgages. Many lenders will offer honeymoon interest rates on loans to get you as a customer. The rates are often very low. Six months to a year later, they go up. They often go above normal rates.

A mortgage application is not written in stone. If you made a mistake, you can submit amendments to it. This is true even if it has already been approved. This will, however, send the process back to step one, so try to get it right from the outset.

The interest rate is the cost to borrow the money from the entity financing you. The APR is that cost plus all other fees. The APR represents a better picture of what you are paying out, but represented as a percentage.

When you get approved for a loan, lock in your interest rate by paying a small fee. Beware, however, there are lenders out there that will try to play funny. They will tell you it is not an absolute lock and try to time your loan to the highest rate possible.

Mortgage professionals are in the business of making money, so don't forget that when loan terms are discussed. Get them in writing if you want to be able to rely on them. Anything else is unenforceable. Mortgages are large debts, so don't risk anything.

To avoid paying PMI - private mortgage insurance - try taking out two loans to buy the home. The first should be for 80 percent. The second should be for the remainder minus whatever you are going to put down in cash. This avoids PMI.

Before applying for a mortgage, many will address their credit. There are a few billion credit repair companies and many are less than stellar. One way to know is the payment. If a credit repair company tries to charge you before fixing your credit, terminate them.

ARM mortgages come with rates known as teasers. They are really low rates that run for the first two years then go up to normal or higher interest rates. Make sure you can afford the highest payments or you will rue the day as many are today.

When it comes to mortgage programs, the government has a good thing going. There are all kinds of programs designed to get you into a home. Make sure to canvas them to see if you qualify for any. If you do, you can save a bundle!

Owning a home is part of the American Dream. It is also a key cornerstone to our economy. Knowing and understand the mortgage process and options can make it all happen for you.


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