Finding a lender that fits your needs is a key part of buying a home. Like finding a realtor, not all lenders are the same, nor do they offer the same products. It’s important to ask the right questions as you’re shopping for a mortgage advisor in West Chester to ensure you find a company that can provide the services and products you need.
Here are some key questions you should ask your lender.
What types of loans do you offer?
There are dozens of different loan options out there, and all are made to provide flexibility and specification. Each lender will offer different loan products, from the standard conventional fixed loan to special loan programs like FHA or VA. Even with a fixed or adjustable-rate mortgage, there are ways to customize the loan. The more options and products a lender offers, the greater chance you’ll get a loan that best matches your unique financial situation.
Do you offer rate locks?
In today’s housing market, things can continuously change. With rates evolving daily, a rate lock can be used to secure the interest rate you initially qualified for. This is a useful tool to ensure that even if the market or interest rates change or your home search takes longer than expected, your interest rate during the application process won’t change. The length of the rate lock available will differ from lender to lender. But most rate locks last 30 to 60 days. Some can even extend up to 120 days, but you may be required to pay a rate-lock fee. At Penn Street Mortgage, our team of mortgage advisor in West Chester will work closely with you to lock in the best rates and provide you with strategic mortgage advice.
What are your fees?
You can expect some standard fees when applying for a mortgage, like a credit report fee and an origination fee. You will also want to confirm if the rate being quoted includes paying any points. 1-point equals 1% of the loan amount. For example, a $200,000 loan with 1-point costs $2,000. Depending on your timeline for staying in the home, it may/may not make sense to consider paying extra to buy the rate down. A mortgage advisor should be able to walk you through the costs and how long it takes to break even.
Depending on the amount of your loan, or the type of mortgage you’re obtaining, there can be additional costs that you’ll have to pay at the closing table. Keep in mind that it’s illegal for lenders to charge an application fee in most states. Make sure you understand what those added costs are and how they impact your bottom line.
Do you sell my loan?
It surprises many homebuyers that the company you originally obtained your mortgage from isn’t usually who you’ll be paying monthly. Many mortgage companies will originate the loan but then sell the servicing rights to other companies shortly after your loan closes. Don’t worry; your interest rates, loan terms, and monthly payments won’t change. This has been a business practice in the mortgage industry for decades. Although there is nothing wrong with it, knowing what to expect after you close on your home can be helpful.
Even after your loan is sold to a different servicer, a good lender will maintain that customer relationship, acting as a resource for future questions or home purchases.
What is your average processing time?
In a competitive housing market, time is of the essence. It’s important to understand what kind of processing and turnaround times you can expect from your lender. Sellers will be looking for buyers that can move fast on their financing and close on time. Most sellers prefer to close in 30 days, but you should ask your lender what a reasonable closing time is. According to Ellie Mae Origination Insight Report, it takes 50 days to close a loan on average. Make sure you account for this once you make an offer on the house or negotiate with sellers.
How frequently do you communicate with your customers?
Communication is key to smoothly and efficiently buying a home. You should know what to expect from your lender’s communication and customer service. This ensures there are no surprises and you are up to speed on your loan’s approval. Some lenders will offer dashboards for their customers to see your loan’s progress, while others will provide daily or weekly updates. Make sure you have a good understanding of what to expect from your lender.
Once your loan has closed, a good mortgage broker will check in to ensure there are no outstanding questions and that your current mortgage fits your needs. Lenders that can provide this top-notch customer service will make the home buying process much more enjoyable.
Remember, there are no wrong questions! As you go through the mortgage process, make sure you ask any questions so you can feel confident and empowered about buying a home. Your lender is there to help, and you should feel reassured that your questions will get answered.
Our mortgage advisor in West Chester, Penn Street Mortgage, are here to provide you with the best customer service and answer whatever questions you have. Contact us today to find out how we can help you.
Contact us here: https://pennstreetmortgage.com/moreinfo/