4 Big Tips On Shopping For A Mortgage

4 Big Tips On Shopping For A Mortgage

At this time of year shopping is on all our minds. It's hard enough shopping for a decent gift for your in-laws, let alone shopping for something like a mortgage. Finding a great mortgage is a crucial part of the home buying process. It will determine your financial state for years to come. You'll want to take your time shopping for a mortgage and get multiple quotes in order to select the best fit for you in your current financial situation. This leads us to tip #1...

1. Find a mortgage that fits your needs. You should begin shopping three to six months before you plan to buy a home. The sooner, the better. You'll need a credit score of at least 660 to qualify for a mortgage and 760 or higher to get the best interest rates. For some, this means they need the time to boost their score.

2. Aim for low interest rates. Your rate will depend on your credit; however, you will find different financial institutions will offer different rates. If you're a first-time homebuyer, you may qualify for lower interest rates through the FHA (Federal Housing Administration).

3. Analyze closing costs.Don't forget to factor in all the extra fees associated with closing, both government-regulated fees and lenders' fees. This could be an extra two to seven percent of the sales price. While you can't negotiate government fees, you can negotiate the lenders' fees. Get a good faith estimate from multiple sources, be it a bank or a broker, to compare costs and use as leverage in your negotiations.  

4. Be aware of fluctuation in interest rates. Once you receive the pre-approval letter, you now have a commitment from that lender to lend you the money needed for a purchase. However, this does not guarantee you the same interest rate. If interest rates change this can be reflected in your rate up until the point that you sign a purchase agreement with the seller. Depending on the lender, you may be able to secure an interest rate for a short period of time anywhere between 30 and 90 days. It's smart to keep an eye on the market and check with lenders if they offer such security.  

Eliminate the stress of shopping for a mortgage by doing your due diligence and ensuring you are taking the best available option. Your financial history will determine what lenders are willing to give you so we advise that you begin shopping early and explore all your options.



Kurt Galitski DRE 01348644 Headshot
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Phone: 714-957-6677
Dated: December 20th 2016
Views: 20
About Kurt: After 15 years of founding and running a successful boutique real estate office in Costa Mesa as a l...

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