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Are you considering making a home purchase at some point in the near future? Then you’ll want to get in touch with a mortgage lender to help you start the process.
Buying a home in WA, ID, OR, or CO is a fantastic idea. Owning real estate will not only provide you with a home you call your own, but it will also provide you with the opportunity to build equity and grow your wealth over time. Real estate has always been a solid way to invest, while also having a place to call home.
Odds are, you’ll need to finance this large purchase; otherwise, you’d have to come up with the cash needed to pay for the asset upfront. If you can’t make an all-cash purchase, you’ll need to take out a home loan to make the transaction happen. And in order to do that, you’ll have to work with a mortgage lender.
These experts are in the business of offering loans specifically to those who are looking to make a home purchase. The loan amount you can get approved for and the interest rate you can secure will depend on a few things, including your financial profile. But they’ll also depend on the mortgage lender you work with.
That’s why it’s so important to ensure that the mortgage lender you pick is the right one for your situation.
The thing is, how do you go about finding a mortgage lender to help you secure a mortgage to finance and buy the home of your dreams? Here are a few tips to consider.
There are many reasons why you might want or need to work with a mortgage lender. Perhaps you’re a first-time homebuyer who is venturing into the world of real estate for the very first time and don’t have a house as an asset to help put towards the purchase of a new home.
Or maybe you’re an empty-nester who is looking to downsize after your kids have grown up and left the house. Or you might be looking for a second home to serve as a vacation destination.
No matter what your needs are, it’s important to understand them which can help to put you on the right path.
The interest rate you can secure on your home loan will make a huge difference in the amount you inevitably have to pay over the life of your loan. It’s important to understand what the going rates are, and how they differ among the different types of mortgages available.
Further, you should understand how your financial profile might impact the rate you can get. For instance, a high credit score, low debt load, and large down payment can help you land at a lower rate than if you had a lower credit score, lots of debt, and a small down payment.
Armed with this knowledge, you’ll be better informed when you start comparison shopping among the various mortgage lenders out there.
Speak with friends, family members, and co-workers about any experiences they may have had with their mortgage lenders. You may also want to speak with a real estate agent to see if they can refer you to a reputable mortgage lender in your area.
Ask questions, such as what their experiences were like working with the mortgage lender and if there is anything they would have liked to see improved. Just keep in mind that not everyone may be in the same financial situation as you, and as such, their experience may differ slightly from what it might be with you.
When you apply for a home loan with a mortgage lender, there are several documents that you will have to supply in order for them to verify your financial status. These can include things such as bank statements, pay stubs, tax receipts, statements of assets and liabilities, letters of employment, and so forth.
If you can gather all this paperwork early on, it will be ready for submission when you apply.
When you’re looking to buy a home and apply for a mortgage, now is not the time to spend too much money and add to your current debt load. In fact, you should be doing the opposite.
Ideally, you should not have a huge amount of debt when you apply for a mortgage. Your mortgage lender might make suggestions about what you should and shouldn’t do to help improve your odds of getting approved for a mortgage, and that may include reducing your spending (especially on your credit card) and avoid taking out new loans or credit accounts.
Ideally, the mortgage lender you work with will have multiple mortgage programs to offer you, each of which comes with its own sets of perks. Depending on your situation, one mortgage program may be better suited to you than another.
For instance, there are 15-year versus 30-year fixed-rate mortgages, adjustable-rate mortgages, conventional and jumbo loans, FHA and VA loans, and so forth. Keeping your options open will give you more to choose from, which will give you more flexibility.
Besides the interest rate, there are certain fees that typically come with a home loan. You’ll want to find out what your mortgage lender’s fees are, which they will be obligated to disclose to you before you sign on the dotted line. That said, it doesn’t hurt to ask what these fees are upfront.
The majority of these fees are paid on closing day, but some mortgage lenders may require things like credit report or appraisal fees to be paid right after the application and approval phases.
Loan limits are dollar caps placed on home loans. For conforming loans, loan limits are caps that are placed on loans backed by Freddie Mac and Fannie Mae, and for FHA loans, loan limits are dollar caps placed on loans backed by the FHA.
VA loan limits were eliminated in 2020. But some homebuyers might still have loan limits to deal with if they currently have VA loans in the works or have defaulted on one in the past.
Loan limits are assigned to every county in the country and usually increase at the start of every year to reflect the growth in home prices.
Check out our mortgage loan limit tool for conventional, FHA, and VA loans.
Sammamish Mortgage is a local mortgage loan company that has been serving clients since 1992. We help borrowers all across the Pacific Northwest, including Washington, Oregon, Idaho, and Colorado. We are proud to offer a wide variety of mortgage programs and products with flexible qualification criteria. Please contact us if you have any questions or are ready to apply for a home loan.
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