Along with decisions about landscaping, window treatments and so many other things you have to consider for your new home, decisions you make about your loan could have a long-term impact on your finances. No matter how much fluctuation there is in the rates or the housing market, Wyndham Capital Mortgage offers the following tips for whenever you’re shopping for a mortgage.
Listen to Recommendations but Seek Independent Guidance as Needed
When you’re ready to purchase a home, family, friends and even your real estate agent are likely to provide you with a list of lenders. While that lenders list is a great place to start, it is important to explore all your options. Part of this process can mean checking various mortgage calculators to get a bigger picture of what’s best for your particular situation.
Take a Deep Dive into How Your Offer is Calculated
Rather than focusing solely on the interest rate and your monthly payment, go deeper into the assorted factors that make up your loan offer. Specifically, you’ll want to ask lenders if the mortgage rates they provide are the lowest for the day or the week, and if that rate is adjustable or fixed. You also should check the points of your loan, which are the fees you could pay for the interest rate. In most cases, the more points you pay, the lower your rate. Also, know why each fee included on your offer is there.
See if Lenders Are Willing to Waive or Reduce Fees
This is not the time to be shy: don’t hesitate to ask if lenders could lower or eliminate fees on your mortgage offers. If they can’t, ask if you can get a lower rate, which may mean paying additional points. After you’ve reached an agreement, compare the new offer with the old one to make sure you get the changes you requested. There’s absolutely no harm in asking for a deal whenever the opportunity presents itself.
Think About How Long You’ll Remain in Your Home
As you’re comparing adjustable-rate mortgages and fixed-rate mortgages, think about how long you plan on staying in your home. If you know you’ll only be in your home for a few years, you might want to consider an adjustable-rate mortgage depending on the current rates. While fixed-rate mortgages often come with higher monthly payments, you are able to lock in the current rate for the life of your loan. Another advantage of fixed-rate mortgages is that you may be able to build up equity in your home faster than you would with an adjustable-rate mortgage.
Consider Your Credit Score and its Impact on Your Mortgage Options
When shopping for a mortgage you should consider your credit score. Should you find you have only one mortgage offer or only a few to compare, one reason might be because you have a low credit score. Working on increasing your credit score may have a positive impact on your mortgage options.
Pro-Tip: Check and Strengthen Your Credit
"Your credit score may determine if you qualify for a mortgage and could affect the interest rate lenders will offer. Staying in tune with your credit score may help make the mortgage process smoother. Follow these three tips to check your score and maybe even improve your score.
1. Get free copies of your credit report from the three credit bureaus
2. Pay all bills on time, keep revolving debt balances low
3. Regularly track your credit score"
A mortgage comparison can be time consuming, but big decisions like this mean the details – and there are many – matter. Do your homework, consider your budget and think of the long-term benefits. Any time before you sign is the perfect time to compare your rate quotes, so let us help by providing you with a quote!