Getting a mortgage or finding the best home equity loan is not an easy and simple task and it should not be taken lightly. There are many important things which are to be considered and paid focus on while getting a mortgage. You will have to suffer and pay a lot if you haven’t focused properly on important matters while getting a mortgage. Here are some of the important things to consider while getting a mortgage or home equity loan.
If you are thinking mortgages as commodities then you are totally wrong. Mortgages are not sat all commodities. If you think that it’s all about the rate then you are going to get disappointed from the initial stage only. It’s all about hunting for a trusted partner who will accompany you and guide you navigate a complicated and kind of complex transaction by giving you honest opinion advise and a good and responsive support during the entire process of loan and mortgage. Thus one of the important things to be considered while getting a mortgage or home equity loan is that you should not only focus on the rate of mortgage but others factors are also to be taken into consideration.
Buying your clothes online, or music player online or order some books online or bid on some sports equipment’s is really a very simple thing to do and even beneficial as it can save up your time but going for mortgage online is really a big no no for you. Mortgaging over the internet is really very risky thing to do. While getting a mortgage or home equity loan it is advisable to meet the party to mortgage face to face and don’t do transaction over internet. There can be so many variables which can arise throughout the process of getting a mortgage or home equity loan over internet. But this does not mean that you should not use the internet for knowing the rates for getting a mortgage as there are many reputable sites on the internet which can help you to find proper rates for getting a mortgage. Internet can also help to get you to calculate the potential loan and along with that it also provide various other information relating to getting a mortgage. Thus it is totally okay to seek knowledge and information regarding getting a mortgage through internet and also getting the rates through internet but it is not at all appropriate to get the mortgage on internet.
While you are on the search of getting a mortgage or home equity loan then you will have to find mortgage lenders. While you are searching for mortgage lenders, you will find two types of mortgage lenders, the one who does advertisement on the web and the other who makes advertisement on the newspaper rate table. You might have of some and might be unaware about some and you come across them when you are hunting for getting a mortgage. You will mot a thing that the major and especially well known lenders will generally give higher prices. Now, you might be wondering why it is so. It is because they are having cost structures and The other reason can be they are more reputable and the service provided them is also better and reliable. Thus they charge higher. Now you should compare the rate with service while searching for getting a mortgage.
If you are planning to move in a short period of time or the loan is for short term or it is a construction loan then you should probably avoid the interest only loans while searching for getting a mortgage. If you are opting for only interest loans then you will not be able to build up any kind of ownership or any kind of equity in your home and hence it is not advisable. Thus try to stay away from such kind of loans while getting a mortgage.
Before getting the mortgage find out what exactly it is going to cost you. There are certain fees which have to be paid and they are unavoidable. But on a contrary, there are certain fees which are not that much necessary and can be considered as junk fees or negotiable fees. Before getting a mortgage ask for good faith estimate statement which shows you the total expected fees. There are certain companies which will include all the fess in the rate of interest they offer to you. Here are some of the fees which you should be asking for before getting a mortgage.
Evaluation of credit
Loan processing fees
Prepayment penalty fees
Fees like amortization schedule fees, financing statement fees, trustee fees, inspection fees, photo inspection fees, warehousing fees, computer fees, administrative fees, credit report review fees, notary fees are some of the junk fess from which you should stay while getting a mortgage.
When you are seeking information about interest rate, don’t forget to ask about the APY as it is generally higher and it is actual amount of interest you have to pay.
Adjustable rate loans can be quite attractive to you as the rate of interest is comparatively lower than the fixed one. They usually avail you with the four options of payment.
Interest only payment
Fully amortized 15 years old loan
Fully amortized 30 years old loan
Last two options are almost similar to that of traditional loans. The only change is that your interest rate is adjustable. Here are some of the reasons for considering an adjustable rate.
If you are planning to sell the home before the first rate adjustment.
If the ceiling of loan of adjustable rate is lower than the current fixed rate.