Thursday, July 19, 2012 / by Ken Parker
New post body.
Save Time and Be Prepared to Make your Offer when the Time is Right!
6 THINGS YOU MUST KNOW BEFORE OBTAINING A MORTGAGE
Mortgage regulations have changed significantly over the last few years, making your options wider than ever. Subtle changes in the
way you approach mortgage shopping, and even small differences in the structure of your mortgage, can cost or save you literally
thousands of dollars and years of expense.
Whether you are about to buy your first home, or are planning to make a move to your next home, it is critical that you inform
yourself about the factors involved.
Industry research has revealed that there are 6 common mistakes that most homebuyers make in mortgage shopping that can have a
significant impact on the outcome of this critical negotiation. If handled correctly, these issues could result in a mortgage
that will cost you less over a shorter period of time.
Before you commit your hard earned dollars to monthly mortgage payments, consider these 6 issues. Effective consideration of
these important areas can make your payments work much harder for you.
But first here are a few quality lenders that I can recommend to help in the process:
Diana Gomez Roy Quintanar
Choice Lending Alaska USA
David Vail Rory Shannon
American Pacific Mortgage Wells Fargo Home Mortgage
1. You can, and should, get preapproved for a mortgage before you go looking for a home.
Preapproval is easy, and can give you complete peace-of-mind when shopping for your home. Your local lending institution can
provide you with written preapproval for you at no cost and no obligation, and it can all be done quite easily over-the-phone.
More than just a verbal approval from your lending institution, a written preapproval is as good as money in the bank. It entails
a completed credit application, and a certificate which guarantees you a mortgage to the specified level when you find
the home you’re looking for.
2. Know what monthly dollar amount you feel comfortable committing to.
When you discuss mortgage preapproval with your lending institution, find out what level you qualify for, but also
pre-assess for yourself what monthly dollar amount you feel comfortable committing to. Your situation may give you a
preapproval amount that is higher (or lower) than the amount of money you would want to pay out each month. By working back and
forth with your lending institution to determine what this monthly amount is, and what value of home this translates into at
today’s rates, you won’t waste time looking at homes that are not in your price range.
3. You should be thinking about your long term goals, and expected situation, to determine the type of mortgage that will
best suit your needs.
There are a number of questions you should be asking yourself before you commit to a certain type of mortgage. How long do you
think you will own this home? What direction are interest rates going in, and how quickly? Is your income expected to change (up
or down) in the near term, impacting how much money you can afford to pay to your mortgage? The answers to these and other
questions will help you determine the most appropriate mortgage you should be seeking.
4. Make sure you understand what prepayment privileges and payment frequency options are available to you.
More frequent payments (for example weekly or biweekly) can literally shave years off your mortgage. Simply by structuring
your payments so that they come out more frequently, will significantly lessen the amount of interest that you will be
charged over the term. For the same reason, authorized prepayment of a certain percentage of your mortgage, or an increase in the amount you pay
monthly, will have a major impact on the number of years you will have to pay and could shorten your payment term considerably.
These two payment options can cut years off your mortgage, and save you thousands of dollars in interest. However, not every
mortgage has these prepayment privileges built in, so make sure you ask the proper questions.
5. Ask if your mortgage is both portable and/or assumable.
A portable mortgage, where available, is one that you can carry with you when you buy your next home and avoid paying any
discharge penalties. This means that you will not have to go through the entire mortgage process again unless you are making a
move up to a much more expensive home.
An assumable mortgage is one that the buyer for your home can take over when you move to your next home. This can be a very
powerful tool at the negotiating table making it much easier and more desirable for a buyer to buy your home, and again saves you
any discharge penalties.
6. You should seriously consider dealing with a Mortgage Expert.
Consider dealing only with a professional who specializes in mortgages. Enlisting their services can make a significant
difference in the cost and effectiveness of the mortgage you obtain. For example, they can make the process faster thereby
avoiding costly delays. Typically there is no cost or obligation to inquire.
We look forward to helping you with your home purchase…!
Ken Parker, MBA, GRI, e-PRO, ABR, CDPE, SFR, APREP
House Buyer Network Specialist
The Good Deal Realty Team
12402 Industrial Blvd – Suite A-2
Victorville, CA 92395
760-900-1042 – direct
760-951-9050 – office
760-951-9121 – fax
“Your Home Sold GUARANTEED*, Or We’ll Buy It!”
*Conditions Apply – Call for Details – 760-900-1042