Tuesday 5 May 2020

4 Questions About Mortgage You Must Ask From The Lender

The thought of investing in a home gives rise to dreams and hopes, and of course, lots of questions. And out of all things, the scariest part for any home buyer is the mortgage. Since your mortgage will stay with you for a long time, it’s important to gather as much information and knowledge as possible on it.

In this post, we have mentioned some questions that you must ask a lender before you consider applying for a mortgage.

What’s the history of the lender?

When it comes to buying a home, you must first figure out which lender are you going to use. There are many players in the mortgage field, including banks, credit unions, mortgage brokers, saving and loans, and finance companies. Ask them how long they have in operation and about their established reputation.

What’s the closing cost?

While you compare lenders, keep in mind that the interest rate is a part of the overall mortgage cost. You will also need to pay the closing costs, which is due at the closing. It’s an important process that officially makes the house yours. Ask the lender to enlighten you with an estimation of the closing costs before you accept the mortgage application.

What fees should you pay upfront?

Many lenders play the trick with buyers by not telling all the fees unless they specifically ask them. Therefore, make sure you ask the full story on the fees before accepting the mortgage application. Ask if there are separate fees for appraising the house, obtaining the credit report, and documentation preparation so that there are no surprises later.

What will be private mortgage insurance costs?

When you make a down payment of less than 20% of the overall home’s cost, the lender will need private mortgage insurance (PMI). This keeps the lender protected in case you default on your home loan. Therefore, ask your lender to get top-level private mortgage insurance in Texas and how can you pay it.

An open discussion with the lender, before filling out a mortgage application, keeps you informed and saved from surprises in the future.

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