Asking Questions About Your Loan

You will be asked a lot of questions during the loan process. Make certain that you ask a lot of them in return. No one but yourself can do this and the answers to these questions in particular will help you to live with your decision and not regret it. Chances are you will have more than one prospective property in mind and you need to audition all the players before making that final decision.

1. If Your Credit Is Not As good As You Hoped And If Rates Are Fluctuating Due To Market Conditions Ask For A Definitive Answer Regarding The Rate You Will Be Expected To Pay.
   Lenders often try to entice buyers by not immediately disclosing all costs, points and fees associated with a purchase. Check any annual percentage rate advertised that will be applied towards the mortgage's interest, it may be higher than the initial rate quoted.
   
   
2. How Many Points Will You Finally End Up Paying For The Discount And Organization?
   Some lenders charge points for discounting the price, check and ask if they do and if so how much? Ask for a specific breakdown of all points and how they will be applied.
   
   
3. Ask The Lender What Are All The Costs For Closing And Demand To See A Good Faith Estimate Of What They Are.
   Try to assess early on what fees are going to be charged above and beyond the actual price of the property. Just like points, fees can accrue that can possibly delay or prohibit you from buying if not brought out into the open as soon s possible. Anyone who shies away from confirming to you what fees and points schedule estimates are is someone to steer clear of.
   
   
4. Try To Lock In Your Interest And Ask How Much That Will Add To Your Purchase Price.
   To avoid being ravaged by fluctuations in the rate market. Ask to lock-in the rate quoted for the period of time that you think it will take you to secure the loan and follow through on it, and then ask if there is an extra charge for that. During this phase in the negotiations try to get an expert opinion on the rate market and how it could apply to you.
   
   
5. Although You May Usually Expect To Wait 6 To 8 Weeks For Your Loan To Be Approved Ask How Long It Will Take.
   You will need to know this when you ask the questions about locking in your interest rates and the fees applied for that.
   
   
6. Ask For The Minimum Percentage Allowed For Your loan.
   If you are then able to put more money towards the down payment you can then ask for a better rate. Typically if you are about come close to a 20% down payment you will be granted a lower rate. But ask. The opposite of this situation is not being able to come up with as much down as the lender expects and you may then be forced to get private mortgage insurance on top of all the other fees and points due.
   
   
7. Ask What Requirements Will Pertain To You In Regard To Your Credit And Income.
   You will always be asked about your credit rating, job status, income and any other loans or liabilities that you may already have. These will also affect the loans parameters. Conversely, you will be asked to corroborate all of these answers with bona fide documentation. Have you cosigned for another person's loan? Be certain not to neglect even one small item, if you do slip up, you may be turned down.
   
8. Although You May Usually Expect To Wait 6 To 8 Weeks For Your Loan To Be Approved Ask How Long It Will Take.
   You will need to know this when you ask the questions about locking in your interest rates and the fees applied to that.
   
   
9. Ask If You Will Be Penalized For Repaying Your Loan Early.
   If you have the good fortune of being able to pay up your loan sooner than anticipated make sure it really is a turn in your favor. You may be asked to pay a percentage of the loan amount or possibly six months interest. Also be certain to ask if there is a penalty, at what point does it take affect.
   
   
10. Ask If There Is Anything That May Stall Your Loan Application.
    If you know that you're financial, marital or employment status could change during the application process this could have a dramatic affect on your loan when you go to sign. Be prepared, as realistic and forthright as you can. It is in your best interests.
    

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