Welcome back to part two of our “Anybody Can Be a Homeowner” series. Today we’re shifting our focus to lenders, and how you can get a great rate if you’re looking to get a mortgage.
Many buyers think they should just hire the first lender they meet, but that’s not a great idea. When you get a quote from a single lender, no matter who it is, you won’t have anything to compare it to. You’ve got to give yourself options by going out and speaking with multiple lenders to compare rates and get the feel of how you’ll work together.
Having leverage in the form of other quotes helps you get the right lender. Let’s say you want to work with Lender B, but Lender A has a better quote. You can get quotes from both, then go back to Lender B and ask them if they can match.
Don’t just look at one type of loan program. There are a lot of options out there. From FHA to VA to conventional loans, the rates are always changing between these programs and if you don’t compare them with a good lender, you won’t know which will be the right one for you. Which is more important to you: a lower rate or a lower down payment? These are the kinds of questions you’ll need to answer.
“Once a lender pulls your credit, you have thirty days to shop around.”
It’s true that when a lender pulls your credit score, it will go down slightly. Once it’s pulled, however, you have the ability to shop around with a bunch of lenders without having a credit check performed every time. The credit bureau allows you and highly recommends you to shop around for rates by giving you 30 days after your credit is initially pulled to make a decision.
After you’ve gotten all of this out of the way, you have to ask your lender how much they charge for financing. Some charge a flat fee, some charge points, and some charge both. Depending on how much your closing costs will be, it could cause your budget to go through the roof. It’s better to know about all this before finding your dream home.
If you have any questions for me about anything we discussed today or anything else related to real estate, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.