Experts say that when looking for a mortgage loan lender, it’s best to have at least three choices to choose from. But what happens next after you’ve gathered the three best options? To help you decide, asking necessary questions will make your quest an easier one.
Here are eight questions to ask your future mortgage lender when applying for Texas Home Loans.
How Much Money Can You Lend Me to Buy a House?
Once you’ve successfully provided the requirements needed for a loan, they will give you a loan estimate. After knowing the amount you can get from a home loan, you can now go house hunting that fits your budget.
How Much Down Payment Do I Need to Give?
If you’re a first-time home buyer, you should know that the bigger down payment you give, the better. While it is true that some lenders won’t ask for a down payment, it’s best to ask your mortgage officer as different types of loans will require you to pay a down payment upfront.
Is There a Prepayment Penalty?
We know one thing’s for sure – you’ll ask about the monthly payment. But did you know that the prepayment penalty exists? It is a penalty one has to make in case you pay a loan off too early. It’s best to take your business elsewhere if your lender says they do have this clause for their home loan.
How Much is the Interest Rate?
Your monthly payment will always have an interest rate, so make sure to check how much interest you need to pay before signing in the contract. The interest rate will depend on many factors such as your credit score, the location, and price of your home, the amount, type and terms of the loan and the type of interest.
Am I Qualified for Down Payment Assistance?
There are down payment assistance programs, and they can be local, state and national ones. If you find one that doesn’t offer such assistance, then it’s best to move on with the next mortgage broker.
What are the Pros and Cons of the Available Mortgages?
Your mortgage will either be a Fixed-Rate Mortgage (FRM) or Adjustable-Rate Mortgage. One of the differences between the two mortgages is that the FRM will have the same interest rate from start to finish. As for the ARM, the interest rate can fluctuate, but that doesn’t mean an FRM is always the best choice. It will still depend on how long you intend on that house.
What Other Fees Do I Need to Worry About?
The down payment, monthly and closing costs are not the only fees you need to pay. This only goes to show that all fees are not limited to the three fees mentioned, but can also go to third-party vendors like taxes, recording fees, appraisal, and Escrow – to name a few.
How Do You Plan to Communicate? Communication is essential, and you won’t want to be the last to know about the things that concern your loan. So, ask your lender how and who will inform you once there are updates, process, and steps that you need to take. Check on their contact numbers, if they will communicate via texts or calls, and if they have an online system, you can use to check in.