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How To Choose The Best Loan For You

Five simple rules and secrets which will assist you in selecting the best loan package for your specific situation.

1. If it seems too good to be true, it probably is. But you didn’t really need us to tell you that, did you? Mortgage money and interest rates all come from the same places, so if something sounds really unbelievable, you better ask a few more questions and find the hook. Is there a prepayment penalty? If the rate seems incredible, are there extra fees or maybe a 10 day mandatory delivery? What is the length of the lock-in? If fees are discounted, is the result a higher interest rate? There is always a chance of human error, but some companies use bait and switch tactics just to try to lock you in with them.
   
   
2. You get what you pay for. If you are looking for the cheapest deal out there, understand that you are placing an immensely important transaction into the hands of the lowest bidder. The best case scenario is that you can expect very little advice, experience and personalized service. The worst case scenario is that you may not close your deal at all. More often than not you are better off paying just a little bit more than you had planned, instead of a little bit less than you should have. Good things are not cheap and cheap things are seldom good. Just remember that if you’ve heard any horror stories from family members, friends or coworkers about missed closing dates, or big surprise changes at the last minute on interest rate or costs…these are often due to working with discount lenders who may have a serious lack of experience. Most importantly, remember that the cheapest rate on the wrong strategy can cost you thousands more in the long run. This is the largest financial transaction most people will make in their lifetime. That being said – we are not the cheapest. Of course our rates and costs are very competitive, but we have also invested in the training, systems, software and teams we need to ensure the top quality experience that you deserve.
   
   
3. Make correct comparisons. When looking at estimates, you can’t simply look at the bottom line. You absolutely must compare lender fees to lender fees, as these are the only items that the lender controls. And make sure lender fees are not “hidden” amongst the title or state fees. A mortgage professional is responsible for quoting other fees involved with a mortgage loan, but since they are third party fees – they are often under-quoted up front by unscrupulous loan officers in order to make their bottom line appear lower. They know that many consumers are not educated to NOT simply look at the bottom line! BONUS TIP: APR is very easily manipulated and worthless as a tool of comparison.
   
   
4. Understand that interest rates and closing costs go hand in hand. This means that you can have any interest rate that you want – but you may pay more in costs if the rate is lower than the norm. On the other hand, you can pay discounted fees, reduced fees, or even no fees at all – but understand that this comes at the expense of a higher interest rate. Either of these balances might be right for you, or perhaps somewhere in between. It all depends on what your financial goals are. A true mortgage professional will be able to offer the best advice and options in terms of the balance between interest rate and closing costs that correctly fits your personal goals.
   
   
5. Understand that interest rates can change daily, even hourly. This means that if you are comparing lender rates and fees – this is a moving target on an hourly basis. For example, if you have two lenders that you just can’t decide between and want a quote from each – you must get this quote at the exact same time on the exact same day with the exact same terms (and pray no one lies) or it will not be an accurate comparison. You also must know the length of the lock you are looking for, since longer rate locks typically have slightly higher rates.

My advice to you is simple. Ask questions, and listen to how you are being treated. I know that I will get you a competitive mortgage that delivers great value, and I also know that NO ONE delivers great service like I do.

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