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How to Compare Mortgage Quotes Between Online Companies and Local Brokers

How to Compare Mortgage Quotes Between Online Companies and Local Brokers

How to Compare Mortgage Quotes Between Online Companies and Local Brokers


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Home Page > Finance > Mortgage > How to Compare Mortgage Quotes Between Online Companies and Local Brokers

How to Compare Mortgage Quotes Between Online Companies and Local Brokers

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How to Compare Mortgage Quotes Between Online Companies and Local Brokers

By: Wayne Townsend

About the Author

Wayne Townsend has worked for over 10 years in the mortgage industry – creating websites for local mortgage lenders and brokers. He has also made available an online mortgage calculator that allows anyone to quickly compare mortgage quotes.

(ArticlesBase SC #328667)

Article Source: http://www.articlesbase.com/How to Compare Mortgage Quotes Between Online Companies and Local Brokers





If you are looking for a new mortgage where do you start to find the right deal for you? It is obviously important that you find the right mortgage at the right price and which suits your circumstances. Once upon a time people tended to just compare interest rates of a handful of lending companies. Nowadays there are numerous types of loan and loan packages. You can obtain your loan from numerous sources including lenders, bankers, finance companies, brokers and credit companies. You can choose to look for your loan from numerous on-line sites or deal with people direct. Working your way through the complex array of options can be mind-boggling. So, how do you know which one to choose?

It certainly pays to do your homework and get familiar with the whole process of acquiring your mortgage and buying your property. Nobody is expecting you to be an expert but armed with some knowledge you are in a good position to understand and to effectively compare mortgage rates and quotations and make your final informed choice.

Below are some tips to bear in mind.

Understanding Terms and Processes

Get familiar with the whole process of applying for your loan and buying your property. There is plenty of information available particularly on-line and many sites will offer a glossary of key terms. As was said earlier you don’t have to become an expert, but some information is better than none. After all it is not everyday you borrow such a large amount of money. It’s worth knowing what is involved. If you have done it before, it is still worthwhile familiarizing your self with the process and any up-dated information.

The Loan Application

Before you begin the process of applying for your loan, whether on-line or off-line, ensure you have available all the relevant personal information and documents relating to your finances. You will be asked about the following:

• your job details and employment stability

• your income

• your financial assets: property, bank accounts, investments and cars

• your liabilities: household expenses, other mortgages, credit-card debt, car loans and installment loans and others.

Make sure you know your financial position. Below is some other important information about your financial status that you will be asked to supply:

Know Your Credit Score.

The size and type of your home mortgage loan will be very much dependent on your credit rating. You can get a free report of your credit. Check it and make sure it is correct. Although the lender will run a credit check on you, it pays to know yourself your own credit score. For your credit check you will have to supply additional documents including: bank account statements, paycheck stubs, investment earnings reports, rental agreements, tax returns, evidence of insurance, and others.

Reduce Your Debt.

You have a better chance of securing more mortgage loan options by reducing your debt as much as possible before you apply. Less debt can bring offers of lower interest rates.

Get a Down Payment.

Having a good down payment or deposit will also help you get better terms for a new home loan. The general rule is at least 10% of the cost of your home, but the more the better. A 20% down payment will usually get you the best rates.

Using on-line calculators will help you to get a picture of your own financial position before start looking for quotes and approaching lenders.

Choosing the loan

You now have information about your own finances you can now seek the loan that will suit your situation. The following are some points upon which you can make comparisons between quotations.

The total cost of a mortgage loan is made up of:

• the interest rate on the loan, which can be fixed or variable and affects the monthly payment you make.

• origination fees

• discount points: One point is equal to 1% of the amount of the loan. Points will affect the amount of cash you must have at closing.

• miscellaneous charges.

Points and fees are usually collected at the loan closing or settlement.

Most lenders offer a range of interest rate/point combinations to meet your needs. As a rule, the higher the interest rate, the lower the points. The loan officer should explain all of your options to you.

Having received an interest rate it is wise to find out if this will be ‘locked in’ and for how long. An advantage of a lock – in is that it protects you from rising interest rates while your loan is being processed. A disadvantage is that means you must close the loan at the quoted interest rate and fee even if interest rates fall just before closing. The lock period must be long enough to get you through the estimated closing date. You can however choose to `float` the interest rate and set the rate nearer the settlement time. But you need to have enough money to allow for a higher interest rate that may occur when you settle.

Having an idea of what your financial situation is like by using an on-line calculator is useful. Also having an idea of your monthly interest payments by using a loan calculator is also useful before you approach a lender. There are a number of internet sites that can help to make the process of getting a loan for your new home. It is recommended that you use a site that has the convenience of allowing you to compare mortgage rates effectively.

Retrieved from “http://www.articlesbase.com/mortgage-articles/how-to-compare-mortgage-quotes-between-online-companies-and-local-brokers-328667.html

(ArticlesBase SC #328667)

Wayne Townsend -
About the Author:

Wayne Townsend has worked for over 10 years in the mortgage industry – creating websites for local mortgage lenders and brokers. He has also made available an online mortgage calculator that allows anyone to quickly compare mortgage quotes.

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