If you’ve been renting, or even if you’ve been in your home for several years and are looking to refinance, undergoing the process of securing a mortgage loan can seem overwhelming. Like any industry, the mortgage business has its own language, but we also have our own inside tips for ways to make the process less intimidating. F.C. Tucker’s Michael Holl, Senior Loan Office for Tucker Mortgage, is sharing these tips to make your home buying or refinance experience as seamless as we think it should be.
- Begin the pre-approval process before you go house hunting
Sellers want to know you have the ability to purchase a property, and being pre-approved for a mortgage loan is the best way to provide them with that assurance. Your real estate agent will help you secure pre-approval with the mortgage company of your choice. Once you’re approved, you’ll realize a number of advantages. You’ll have greater legitimacy with sellers who see that you have a lender committed to backing your offer. You’ll have the edge over other buyers who aren’t pre-approved, which can work in your favor when there are multiple offers on a property. And you’ll be better able to focus your search on properties that match your financing abilities.
- Being pre-qualified is not enough
Be sure to get pre-approved, and not just pre-qualified for your mortgage loan. Pre-qualification simply means a lender will ask you some questions regarding your income, assets, and debt, then they may pull your credit. The lender will run numbers for you, but your file will not be reviewed by an underwriter. With a loan Pre-Approval, the lender will not only ask questions about your income, assets, and debt, they will pull your credit and verify your income and assets. Then, your loan file will be reviewed and pre-approved by the lender’s underwriter. You will receive a pre-approval letter from the bank that you can show to sellers and to real estate agents to indicate you are a good risk.
- Bank or broker, what’s the difference?
Borrowers have several options in their search for mortgage loan sources. It’s best, when searching, to compare specific kinds of loans, such as a fixed rate mortgage or an adjustable, so you are comparing apples to apples. You may choose to work with a lender such as a mortgage bank, commercial bank, community bank or credit union. If you have a long-term relationship with a lender, you could be offered more favorable terms on your loan and be offered more loan options. A mortgage broker who is not employed by a specific lender may be able to shop for a wider range of loan options on your behalf, but brokers typically can’t provide quick turnaround on loan applications, but some banks can. Save yourself the broker fees and extra steps and frustrations by working directly with your real estate agent to search for a lender.
Go to www.talktotucker.com/talk for all 10 tips on mortgaging!
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