So what exactly are the steps one should take to find the best mortgage? Here’s a quick rundown.
* Collect information from several different lenders to find their best price. The best mortgage lender knows that even if you shop around, you will return to them. A mortgage broker can help you find a lender for you but make sure you always ask about how they are compensated for their services.
* Get all of the cost information you need. Ask about the lowest mortgage interest rate that the lender or broker offers, whether the rate is fixed or adjustable, and the loan’s Annual Percentage Rate, or APR. Learn about the current rates and points, and ask that the points be quoted in dollar amounts. Learn what fees are involved in the mortgage, and which services are linked to which fees. Lastly, learn about the requirements for downpayments. If you cannot provide a down payment, you might have to buy private mortgage insurance, or a PMI.
* Lastly, after comparing lenders and brokers, choose the best mortgage lender and then start negotiating. Ask if any of the fees can be lowered or waived. After negotiating, you can request a written “lock-in,” which carves what you have agreed on in stone or more technically, on paper. This document should include the rate that you agreed to pay, the duration of the lock-in, and how many points need payment.
Being number one is never easy, so searching for a premium mortgage rate will require some footwork. But if you can find the best mortgage lender, consider the work well worth every painstaking minute and hour. It’s also considerably easier than ever before through various online services.