How to Compare Mortgage Loans From Different Lenders

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Getting a mortgage is one of the first steps toward buying the home of your dreams. However, you need to make sure that you are getting the best rate on the market. To help you do so, it is a good idea to shop around and look at rates from a variety of lenders. How do you do this?

Mortgage Brokers Can Check Rates for You

A mortgage broker is different than a traditional mortgage lender because this person picks from a variety of loans and lenders to find one that is best for you. Therefore, you are able to see all of your options and learn about loan programs that may only be available from select lenders. After you pick a loan that is right for you, all you have to do is fill out an application and start the closing process.

Checking Online Could Help You Compare Rates

If you aren’t ready to start applying for loans or don’t know which lender you want to work with, it may be best to do an online search of loans and loan providers. Comparison sites can help you find the lowest rates from top lenders based on your credit score, income and other parameters. While your actual rate will depend on your creditworthiness at the time of your application, you can get a good idea as to how much you would have to pay for the right to obtain the money.

Call Lenders on an Individual Basis About Their Loans

You don’t have to get quotes from lenders all at the same time. Instead, it may be easier to get detailed information in an easy to digest way by talking to individual lenders on your own. For instance, you could talk to the big bank in town, your local credit union and an online lender to determine which type of lender best fits your needs.

What Information Should You Ask For?

To make an informed decision, you will want to ask for the interest rate on the loan, any required down payment and what sources of funding can be used for that down payment. You should also ask about any penalties for paying early as some may want to make extra payments to avoid as much interest on the loan as possible.

Getting a mortgage is a big step in your quest to buy a home. It is also a large commitment as you could be spending up to $100,000 dollars or more on a single property. Therefore, make sure you do your homework and obtain the best loan that your credit profile can get you.