Finance
It is always best to contact your lender and get pre-qualified, or even better, pre-approved, before starting your search for a home.
Buying a home, on average, is a process that takes about 30 days to complete because it is a process that has several stages, with each stage engaging the services of a different person or professional, that has something to do with successfully closing escrow on your home. These are the home inspectors, pest inspectors, contractors, appraisers, escrow officers and title representatives of the industry. But the most critical professional of all is the lender.
Everything hinges on the financing.
If the lender doesn't perform as he or she should, it can be very costly to the buyer, even causing them to lose their deposit, which can be several thousand dollars. Therefore your choice of a lender is CRITICAL.
There are hundreds of options for you in the marketplace, many of them being online these days. Who you choose as your lender, ultimately, is up to you, but allow us to give you a little advice first:
The best option is to go with someone local, that either you know, or that was referred to you by a friend, or us, your Realtors.
Online lenders look good on the surface, but, our experience is that problems tend to be more frequent, and communication tends to be inconsistent, when working with a lender who was contacted online.
Our philosophy: There is too much at stake to trust it with someone you've never met, or never will meet, because there is no accountability to you, or to us, to do the job right.
If you'd like a referral from me, please just let me know. I can confidently refer you to one of a few local lenders that have proven themselves to me, and to our clients, on many occasions, as reliable and trustworthy professionals.
Adjustable - An Adjustable Rate Mortgage, or ARM, is a type of mortgage in which the interest rate is adjusted up or down, in accordance with current interest rate levels. The interest rates are tied to an economic index outside of your banks control, such as the Treasury bill rate. Your monthly principal and interest payment will fluctuate with these rate changes. Initially payments will be less than with a fixed mortgage, making this type of mortgage attractive to short-term buyers. Note: Inquire on the "cap", or maximum interest level your mortgage can reach, since it is possible for rates to raise significantly during the term of your mortgage.
Fixed - A fixed rate mortgage, on the other hand, uses both a fixed term (length of time) and fixed interest rate. At the start of the mortgage the rate and term are determined, and as a result the monthly amount for principal and interest payments remain constant for the duration of the mortgage. Fixed rate loans are more attractive to home buyers who plan on spending a long time in their home, or expect no major change in income.
Assumable - Sometimes homebuyers can find a loan which is "assumable." With an assumable loan, the current sellers lender is willing to transfer the existing loan to you, either at the previous interest rate or the current interest rate. Assumable loans are attractive to buyers because they usually require less paper work and less time.
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