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| How do I choose the best loan program for me? | |
Your personal situation will determine
the best kind of loan for you. By asking yourself a few questions, you can
help narrow your search among the many options available and discover
which loan suits you best.
Your lender can help you use your answers to questions such as these to decide which loan best fits your needs. |
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| What is the best way to compare loan terms between lenders? | |
| First, devise a checklist for the
information from each lending institution. You should include the
company's name and basic information, the type of mortgage, minimum down
payment required, interest rate and points, closing costs, loan processing
time, and whether prepayment is allowed. Speak with companies by phone or in person. Be sure to call every lender on the list the same day, as interest rates can fluctuate daily. In addition to doing your own research, your real estate agent may have access to a database of lender and mortgage options. Though your agent may primarily be affiliated with a particular lending institution, he or she may also be able to suggest a variety of different lender options to you. |
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| Are there any costs or fees associated with the loan origination process? | |
| Yes. When you turn in your application, you'll be required to pay a loan application fee to cover the costs of underwriting the loan. This fee pays for the home appraisal, a copy of your credit report, and any additional charges that may be necessary. The application fee is generally non-refundable. | |
| What is RESPA?? | |
| RESPA stands for Real Estate Settlement Procedures Act. It requires lenders to disclose information to potential customers throughout the mortgage process. By doing so, it protects borrowers from abuses by lending institutions. RESPA mandates that lenders fully inform borrowers about all closing costs, lender servicing and escrow account practices, and business relationships between closing service providers and other parties to the transaction. | |
| What is a good faith estimate, and how does it help me? | |
| It's an estimate that lists all fees paid before closing, all closing costs, and any escrow costs you will encounter when purchasing a home. The lender must supply it within three days of your application so that you can make accurate judgments when shopping for a loan. | |
| Besides RESPA, does the lender have any additional responsibilities? | |
| Lenders are not allowed to discriminate in any way against potential borrowers. | |
| What responsibilities do I have during the lending process? | |
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