By Joseph Pisicchio
When it’s time to purchase or refinance a home the first question that many people think of is "how do I find the best fixed rate mortgage?" Although this is a very natural question, the process of shopping around for a mortgage is actually more involved than simply looking at the interest rate.
To evaluate whether you are getting the best mortgage deal, you need to look at two components. The interest rate you are being offered and the total closing costs charged by the lender. One bank might have a lower interest rate, but their fees may be higher than that of another bank. Sometimes, shopping by APR can be helpful. However, it does not always work based on new guidelines and laws
To complicate matters, it's important to make sure that the lender you are dealing with is reputable and honest. If not, they can very easily make any representation and then change the numbers later on. Unfortunately, there have never been any strong government regulations that have prevented lenders from the old "bait and switch".
When shopping around for the best deal, the most important tool or resource you need to see is the Good Faith Estimate (GFE). The GFE is a summary as well as a collection of all the costs associated with your loan transaction. It will contain your interest rate, total monthly payment and all of the costs associated with your transaction. Remember, as the name says, it is merely an estimate. You will never know the exact cost, to the penny, until the closing date when you receive the HUD settlement statement. Many unscrupulous lenders will use this to their advantage in an effort to present the best deal initially and then change it at the closing. This practice is extremely common!
There are many things you can do to protect yourself against this from happening. The first thing you should do is to check any potential company out with the Better Business Bureau. You should also compare the rate they are offering with a national lender (Like Chase or CitiBank). If you find the difference is significant, it could mean the rate they are advertising is bogus or something they cannot deliver.
The most important thing you can do when shopping to find the best fixed rate mortgage is to learn about the entire process before you commit to any lender. Invest in a simple mortgage guide. Having a complete understanding will not only provide education, it will actually help save you money and time. Mortgage rates and fees are negotiable. Once you learn the tricks and secrets it is absolutely possible not only find a great deal, but make it even better.
A mortgage will be the biggest financial investment of your lifetime, it is important to understand all of the facts before simply randomly choosing a lender. For more information visit bestfixedratemortgage.
To complicate matters, it's important to make sure that the lender you are dealing with is reputable and honest. If not, they can very easily make any representation and then change the numbers later on. Unfortunately, there have never been any strong government regulations that have prevented lenders from the old "bait and switch".
When shopping around for the best deal, the most important tool or resource you need to see is the Good Faith Estimate (GFE). The GFE is a summary as well as a collection of all the costs associated with your loan transaction. It will contain your interest rate, total monthly payment and all of the costs associated with your transaction. Remember, as the name says, it is merely an estimate. You will never know the exact cost, to the penny, until the closing date when you receive the HUD settlement statement. Many unscrupulous lenders will use this to their advantage in an effort to present the best deal initially and then change it at the closing. This practice is extremely common!
There are many things you can do to protect yourself against this from happening. The first thing you should do is to check any potential company out with the Better Business Bureau. You should also compare the rate they are offering with a national lender (Like Chase or CitiBank). If you find the difference is significant, it could mean the rate they are advertising is bogus or something they cannot deliver.
The most important thing you can do when shopping to find the best fixed rate mortgage is to learn about the entire process before you commit to any lender. Invest in a simple mortgage guide. Having a complete understanding will not only provide education, it will actually help save you money and time. Mortgage rates and fees are negotiable. Once you learn the tricks and secrets it is absolutely possible not only find a great deal, but make it even better.
A mortgage will be the biggest financial investment of your lifetime, it is important to understand all of the facts before simply randomly choosing a lender. For more information visit bestfixedratemortgage.
(Source : buzzle.com)
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