We are looking to buy a house, but I've never done it before and would like to know which lending institutions have the best interest rate or which ones are the best to work with. I would appreciate serious feedback and answers. Thank you! :)
2007-07-11 03:17:15 · 4 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
You want to know what you are qualified to purchase as well as the interest rate you are qualified for based on your credit score.
You have to know what you are qualified to purchase even if you have bad credit.
speculation is just that speculation.
So the first thing you should do is contact a mortgage broker so you can complete a loan application, after which he will run your credit report. They also will locate and find the best mortgage for your credit and credit score.
This credit report will give him your credit score. Get a cup of coffee or your favorite beverage when filling out the loan application this is not a 15 minute chore.
Your credit score will tell him what loan programs you are qualified for as well as the interest rate you can expect. This credit score will tell if you are able to get a 100% loan and if not how much cash you have to bring to the table as your down payment.
There are lots of documents and information the mortgage broker will need. I will give you a few to get you started.
#1 Six months of all bank statements you use currently, as well as any statements from your 401k at your place of employment
#2 One months of pay stubs from all that are going on the mortgage.
#3 Two years of federal income taxes and W-2s
After discussing the best loan program for you and agreeing on the program you want, the mortgage broker will issue you a pre-approval letter. Don't forget your good faith estimate (GFE). This will give you an idea of the cost of your loan. That
is in addition to any down payment how much additional cash you must bring to the closing table.
In order to preclude PMI when a lender will finance 100% of the house you are buying the mortgage industry have solved that problem by offering a 80/20 loan. Don't be afraid of them.
You have to understand that the increase in payment if the loans are adjustable.
Your first mortgage (80%) might be a fixed product, while your second (20%) could be an adjustable product. If you don't understand the product ask your mortgage broker and don't leave until he/she has explained it to your satisfaction.
Now once this has been established you should connect up with a real estate agent to find you a home. Upon finding a home you like the real estate agent will then prepare a sales contract for you and the seller to sign.
The mortgage broker will order an appraisal of the house to prove the value.
Once all the documents necessary has been collected the mortgage broker will order loan docs for the program that you agreed to earlier. Again don't plan on spending a lunch hour there to sign loan docs this is a process so be prepared to be there for awhile.
Don't sign the loan docs if anything has change from what the mortgage broker explained to you. Call and get an explanation.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-07-11 05:46:45 · answer #1 · answered by loanmasterone 7 · 0⤊ 0⤋
Call some local banks and mortgage companies. Ask about interest rate and fees. Some places charge points and/or origination fees which equal 1% per point of the selling price and are paid at closing. So, if you buy a house for $150K and there are 2 points you'll pay an extra $3000 at closing. Some places charge points in order to offer a lower interest rate. So, you'll need to look at how much you have for your down payment and closing costs and then decide if you want a lower rate with points or a little bit higher rate without points. When you call, ask how much you need for a down payment and tell them you are a first time buyer. Sometimes there are special deals for first time buyers. When you decide on one company, ask if they will pre-approve you. That will help when you find the house you want. It looks good to the seller and it will save you a little time getting to closing.
2007-07-11 04:16:04 · answer #2 · answered by angela 6 · 0⤊ 0⤋
Check with some local mortgage brokers. They can shop various lenders for you and in a lot of cases can get you a better rate than a bank.
2007-07-11 03:21:09 · answer #3 · answered by mister_galager 5 · 0⤊ 0⤋
Lenders vary from situation to situation, it depends on what kind of loan they really like to focus on. The idea is to find a broker, tell him what you want and have him get it for you. A broker has the resources to shop with local and national level banks to find the ideal situation for yourself.
2007-07-11 04:11:46 · answer #4 · answered by marxistharpist 2 · 0⤊ 1⤋