TIP 3 - MORTGAGE BANKERS PROVIDE YOU MORE LOAN CHOICES
This series of essential tips for Arizona home buyers are designed to help you through the home buying process – a road map to follow while buying a home for sale in Arizona to ensure a smooth transaction – and, most importantly, to ensure you have a rewarding home ownership experience.
Shop for Mortgage Bankers Who Offer More Loans Options Tailored to Your Specific Needs!
While getting Pre-Approved for a mortgage is an important step for any buyer - not just a first time home buyer - so is shopping for the best deal possible. You will probably be paying the mortgage for a while, so getting the lowest mortgage rate should be ONE of your prime considerations. Be sure to look at the annual percentage rate you are paying (commonly referred to as the APR) so you can compare one loan to another. With some loans, you may be required to pay more points or have higher closing costs than others and the APR factors those costs into account – not just the loan rate.
There's a Lot of Money to be Made - Beware
There is a lot of money to be made when a loan is originated. You have to confirm your lender's cost are competitive. If you are a golden buyer, rates and costs will probably be lower. If you aren't golden, the investor who has the loan you need may want more money to do business with you. Maybe the investor knows he is your last resort - you have no other choice but to pay the loan fees demanded. Knowing your FICO score will let you know whether or not you are a golden buyer or considered a higher credit risk. I will recommend mortgage bankers to you who I know, to be honest, knowledgeable and can find the loan you need for rock bottom pricing.
Let’s face it - you are not a loan expert who knows where to find the best type of loan, loan rate and terms that best match your requirements. If you know you are moving in 2 to 4 years, you don't want to pay more for a higher, fixed rate 30-year loan that doesn't benefit you. But you don't want to pay a penalty for paying your loan off early either. When you go to your bank, they try to match you to one of their loan programs. They don't have hundreds of loan outlets to find a loan that is a good match for you. But other loan outlets may offer better loan programs? You need to find out! But which is best for you? And will the lender get the job done? In many cases, a mortgage banker can get the same or better rate offered through your own bank - as a loan correspondent of the bank - than the bank employee can offer you. But a mortgage banker may be able to find even better deals elsewhere that are tailored to your needs and your unique situation.
Case in point - variable rate loans normally have a lower “start” rate, but you won't know the cost of a variable interest rate loan over the life of the loan. Nobody knows! But if you are only going to be living in the house for a couple of years before being transferred to another city or you are on the fast track for a big promotion and plan to move up soon, getting a loan with a lower adjustable rate, fixed for the first 5 years, is a sweet deal.
So when shopping for the best mortgage possible, don’t just look at the rate, look at the whole package including the quality of the mortgage professional you choose to have guided you. It is perfectly acceptable to pay a higher loan rate so your lender can get a rebate to pay part of your closing costs when you don't have all the cash you need to buy a home. There are so many ways to get you into your dream home. Contact Sam so we can talk about them.
WORK WITH A TRUSTED ADVISER who will guide and advise you. You don't want to be learning on the job as you shop for a loan to purchase your next home. This is probably your biggest investment! You don't want to learn later what you didn't know and what it cost you to learn a valuable lesson. Ask Sam for a list of Mortgage Bankers he knows and you can trust.
STAYED TUNED - Anything in big doses is hard to digest. Instead of blasting you with 20 home buyer tips, you are going to receive my recommendations in small bites…
So this is the third installment. If you are buying a home now and want all 20 tips at once, email me and it will be on its way to you. Otherwise, my blog will eventually include all 20 home buyer essential tips. Return to Buyer Tip 2 or continue on to Buyer Tip 4.
Arizona Associate Broker, CRS, GRI, e-PRO
Berkshire Hathaway HomeServices | Arizona Properties
Contact Sam to discuss your Arizona home purchase plans and schedule an appointment to see how he can help make your plans become a reality.