The last remaining vestiges of the warmer weather are saying their goodbyes around Lake Keowee this week as we’ll see highs in the mid-80’s. Going forward, expect to see your breath in the mornings. So you’d best get out on Lake Keowee to jet ski, swim, boat, do whatever you want in the water because winter is nigh!
Choosing the right mortgage will affect your very financial future. Here’s vital information to help you weigh your options and make a sound decision.
An Insider’s Guide to Understanding Mortgage Loans
Questions to ask while shopping for a loan
Before you can effectively compare mortgages, there are a number of questions you’ll need to ask the loan officer. Some are obvious, others are not. Be sure to ask them all.
Kinds of Financing – Fixed? Adjustable? What about government-backed programs? Any special deals you should be aware of? Make sure you’ve got a complete picture of the product menu.
Prepayment Penalty – If you decide to pay off your mortgage before the term is up, or refinance when interest rates go down, you may have to pay a prepayment penalty (not in SC).
Special Deals – Some lenders reduce interest rates for customers who avail themselves of other services offered. For example, your bank might take a quarter of a percentage point off if you agree to automatic prepayment from you checking account.
Time to Approval – Find out how long it will be before you’ll have a decision on whether or not your loan application has been approved by the lender. A week or two is pretty normal.
Loan Commitment Period – Make sure you know how long your lender’s commitment is good for. The last thing you need is to decide on a loan amount at a certain rate, find the right home and discover your interest rate went up in the meantime.
Many lenders now offer lock-in programs – This means that the lender will guarantee in writing your loan at a certain rate for a certain period of time. Common lock-ins are 10-, 12-, 21-, 30-,45-, and 60-day periods. The longer the lock-in, the more time you have to shop and iron out hitches in the loan process. But a lender might charge you more in points for longer periods. Then again, a short lock-in period can be next to useless given the amount of time the loan process can take. The lesson here is to be very clear of what a lock-ion offers – and doesn’t offer.
Once you have this and other information on various loan programs from different sources, you can make an informed decision as to where to shop for the best mortgage.
