Questions To Ask When Applying For A Mortgage

by | Mar 19, 2013 | Business

Once you have found the lender where you are going to get your mortgage, you will want to be sure and ask all the questions necessary to be comfortable as you move forward in this big Endeavour. One of the first things you will want to ask is what your interest rate with be on your mortgage. Interest rate is very important and will need to be determined before you go any further as it can greatly affect your monthly payment.

Also you will want to ask how many discount and origination points you will have to pay. Many lenders charge prepaid mortgage interest points to help to make your interest rate lower. Yet another question you will want to make sure to ask when getting your mortgage is what your closing costs will be. Some lenders will give you a good faith letter spelling out exactly what your closing costs will be or at least a good estimate of it within three days of receiving your loan application. If a lender is not willing to do this it is probably best that you do not continue with that lender.

Your interest rate on your mortgage may change a bit from the time you fill out your loan application to the time that you actually close on the loan so you will want to be sure to ask when exactly you can lock in your interest rate.

Before settling up with your mortgage company you have chosen you will want to ask what the minimum down payment will be for you for this loan. Usually it is 5 to 20 percent of the total purchase price but if you can manage to put more money down you may be able to lower the rate and improve your terms, so be sure to ask about this as well.

You may want to ask in advance what documents you will have to provide such as paystubs and other documents. If you have really good credit sometimes you can get out of having to provide these documents all together which can save time on processing your loan. You may not want to do this however, because it can cause you to have to pay a bigger down payment and have a higher interest rate.

You may want to ask how long it will take to process your mortgage loan and what things might slow it down. Two week is the typical time frame you will have to wait on your loan processing but it can take up to 60 days. One thing that can slow down the entire process is if your loan lender finds out you have bad credit. Make sure your credit is good before you waste anyone’s time.


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