Deciding to buy a home is exciting! The next step is finding mortgage lenders to finance your new home. Since your home will be one of your most important investments, you want to make informed decisions. Doing your research on the front end of the mortgage loan will make you happier and more productive in the long run.
The Scoop on Mortgages
A mortgage is a loan that helps you purchase your home. In exchange for the funds, you legally agree to pay back the funds within a certain time period. The principal is the amount of money being borrowed to purchase the home, and the interest is the lender’s charge for loaning you the funds. Together, the principal and interest comprise your monthly payments as well as some additional fees (taxes, private mortgage insurance, etc.) that may or may not be applicable. Take note of whether the loan has variable or fixed interest rates.
How to Find a Lender
Many people choose their mortgage lender based on the best interest rate, but you may want to consider other factors. While a low-interest rate is enticing, you also want to consider other fees that may be involved in securing a mortgage loan. Application fees, late payment fees, and other dues can drive up the cost of your loan over time.
Be mindful of the approach of the lender. Many community banks treat you with a more relationship centered approach, whereas other institutions handle you simply like another account number.
Check out the lender’s reviews. The internet is good for more than just interest rate comparisons. Utilize the net to review the lender’s ratings. What are other homeowners saying about that particular lender? What type of relationships were they able to establish with the institution? What were their experiences? Specifically assess whether reviewers comment on how helpful and knowledgeable lenders are and whether they stick to their word.
One important factor first time homebuyers often overlook is how long it will take to process the loan. Ask the lender about timelines and notable deadlines. Notice whether the lender can provide you with important information and realistic expectations.
Lastly, assess whether the lender is concerned about you or just making the sale. Buying a home is such a large commitment, and you want the people involved in the process to be in your corner. The process should be collaborative and easy to understand. When you look for a mortgage loan in Knoxville, be sure to consider the lender. You deserve the best!
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