Top Ten Tips for Financing a Home
(ARA) – Warmer weather and the conclusion of another school year are two signs that summer is almost here. While many Americans get ready for summer travel, barbeques, and other rites of the season, thousands will be taking advantage of a buyer’s market by looking for a new place to call home.
This buying season is unprecedented as the real estate market has gone through changes that no one could have imagined even one year ago. Whether you are buying your first home, looking for a larger home or even buying a vacation home, the timing could not be better as the prices have come down in many markets and there are plenty of homes to choose from.
While researching and walking through properties is what most people think of when buying a new home, prospective buyers also need to be aware that lining up proper financing is now more important than ever before. However, while lenders have tightened credit standards, buyers should not be intimidated by the process of getting a mortgage. In fact, working with a lender early on is the first step to take before you begin paging through the Sunday Real Estate section.
‘Working with a mortgage lender early in the homebuying process can make the entire process much smoother,’ says Frank Destra, managing director and senior vice president of national sales for Internet lender, Ditech. ‘With a credit pre-approval, you can start searching for homes with a much better idea of your price range, and in turn save time as you will know which homes to focus on. A pre-approval also may offer more confidence to home sellers in your ability to purchase the home.’
Destra offers 10 tips to help make the home financing process easier.
- Attend a home-financing seminar or read information available from online mortgage lenders to gain a clearer understanding of the process.
- Understand your credit. Be aware that your credit history may impact the interest rate charged, and the type of loan program for which you may qualify.
- Become familiar with all mortgage-related terms such as Annual Percentage Rate (APR) and Private Mortgage Insurance (PMI). Your loan officer should be able to explain these terms to you.
- When shopping for a lender, compare not only interest rates, but other related fees and charges, as well. All lenders should automatically provide this information so you can make comparisons.
- Ask your loan officer if you may benefit from credit counseling services.
- Ask your loan officer for a list of what information you will need to complete an application. Having the correct documents ready may help the lender provide a faster loan decision.
- Request a credit pre-approval decision from your lender. It will determine how much you may be able afford, and can speed up the mortgage process once you find a home.
- Review several types of mortgage products offered by your lender. Discuss these options with your loan officer to determine which may be right for you.
- Put aside money for down payment and closing costs. Ask your lender how much money you will likely need for the type of mortgage and loan amount that you are receiving.
- Carefully review the Good Faith Estimate you receive from your lender and be sure to ask questions. A Good Faith Estimate is a form required by federal law that discloses an estimate of the cost associated with your mortgage transaction. It is important that you fully understand all fees and charges associated with securing your loan.
By keeping these tips in mind, you will be better able to navigate through the homebuying process. Soon you will be settling into your new home, just in time to enjoy the summer season.
To learn more about financing a home purchase, visit www.ditech.com or call (800) 715-3483.
Courtesy of ARAcontent