As a borrower, you are forced to make certain you come prepared to a meeting with a mortgage lender and ask the right questions to find out if the lender is right for you. These questions should always be on your lips when you sit down to interview a mortgage company.
Are You a Lender or a Broker?
Who the professional is working for, and what they can bring to the table are essential to any dialogue of your mortgage needs. The people who work in this profession vary widely. They can include mortgage brokers, banks, mortgage companies, and even credit unions. If you know who and what they represent, you can provide to tailor your conversation for the best possible result.
Is Your Mortgage Broker Licensed?
Every mortgage broker should be licensed, and it is your responsibility to figure out whether they are or not. Most states require that mortgage brokers undergo signficant training, testing, and licensure before they even begin to work. Be sure to require written evidence of the testing and licensure when you talk with your mortgage broker. A savvy con man will often try to talk his way out of this requirement. Also, the states regulatory agency will most likely have a quick look up system on their website so that you can verify if the potential mortgage broker is being honest.
What Interest Rates Can You Provide?
This is one question that is on the lips of most borrowers, and with good reason. This crucial number can assist the mortgage company know how much you will be charged for borrowing the money. The traits of this interest rate will dictate the overall cost of the loan, and whether or not it can be afforded. It is important to determine the type of rate being offered, including if it fixed or variable. Also ask if the rate being offered is their best deal. Unless you ask, a lender may fail to mention a better option, especially if it isn't neccessarily better for them.
What Is the Expected Annual Percentage Rate (APR)?
You probably will recognize the term of Annual Percentage Rate from your credit card statements. You'll see the same term on your home loan paperwork. The APR can often help you determine whether or not the lender is being completely forthcomming. The annual percentage rate includes the interest rate of the loan, the cost, and other lesser known financial charges.
If the APR is more than three quarters of a point more than the advertised interest rate for the loan, you'll have to deal with sizable fees being attached to the loan. The APR can be used as a tool to help you make sure the lender is giving you the best deal possible.
These four questions will help you decide if a lender has exactly what you need. Their answers should be complete and forthcoming. If you're unsure, more on to the next choice. There are a lot of mortgage brokers that would welcome your business.
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