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SHOPPING FOR THE BEST The most important thing to look for when you are shopping for a mortgage is the interest rate, right? Not necessarily. There are many other factors to consider, including the lender's charges for making the loan, the terms under which the loan will be approved, and the lender's reputation for timely completion of loan applications to meet purchase agreement deadlines. Also keep in mind that the "stated" interest rate for a given loan may not include interest paid in advance, also known as "points." Additionally, please keep a wary eye out for the percentage of the loan amount quoted as a "pre-payment" penalty, even if refinancing. Sellers have been "stunned" at the closing table with cuts to their equity. When real estate professionals are involved in sales transactions, they can provide you with the names of established lenders who have provided good service to their customers. They can help you compare the different mortgage options that are available today. Using a low interest rate as the main criteria for choosing a mortgage could cost you money at the closing table--and perhaps the home you want--if the company cannot deliver on its promises. |