What important question should I be asking my mortgage broker after I’ve been preapproved?

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My mortgage broker has told be that I am pre qualified for a home loan. He has told me what my interest rate will be. I’ve found a home, but know I should be asking more questions before closing. Can anyone help? I don’t want to get to closing and find out I could have done something to improve my interest rate or even worse cant close.

7 Comments
  1. Reply
    StephanieS
    May 17, 2011 at 12:12 am

    how long is the interest rate locked in for?

  2. Reply
    Blue October
    May 17, 2011 at 1:01 am

    Kristen-
    make sure you know what type of home loan you are getting yourself into.
    do not accept an ARM (adjustable rate mortgage). these loans are adjustable (sometimes monthly) and it causes your payment to go up and continue to rise until you are foreced into foreclosure.
    make sure you have a 30 yr+ fixed loan with no prepayment penalties.

    Ask if you will need mortgage insurance.

    good luck 🙂

  3. Reply
    John S
    May 17, 2011 at 1:31 am

    make sure you are in a 30 year fixed product since rates are still decent.

    ask the mortgage broker for a GFE (Good Faith Estimate) of all fees that will be associated with the transaction INCLUDING any and all of his/her broker charges.

    you really don’t want to be paying for points to buy down the rate if you are not going to be in the home for too long. 1 point equals 1 percent of the mortgage loan amount. points generally take between 4 & 7 years until you see the break even benefit of paying the upfront expense of the points at closing versus the lower monthly mortgage payment paying back that initial expense.

    make sure there are no prepayment penalties on the mortgage.

    they are pretty much the biggies.

  4. Reply
    peoplehi5
    May 17, 2011 at 1:59 am

    Be sure you know what your options are for different term loans. Find out about Private Mortgage insurance, homeowners insurance, any necessary insurance riders, property tax and anything else that could possibly be put into your monthly payment and/or paid out of escrow. Find out what different down-payments will do to your interest rate and monthly payment amount.

    Do NOT buy the most expensive house your credit will allow you to afford. Making extra payments will save you interest, build equity faster, and allow you to pay off yuor mortgage earlier or to upgrade to a nicer home sooner.

    Find out about home warranties and evaluate anything you will need to maintain, upgrade, or buy (such as a lawnmower, new roof in 3 years, appliances, or furniture).

    Find out what lenders she works with and research their reputation.

    Be prepared for the final numbers to be different than the pre-approval. Not usually by much, but sometimes final factors can change you rate by a quarter percent or more or change the ammount you can borrow inthe end.

    Talk to anyone you know who has recently gone throught the buying process, ask what research they did and if there were any surprises at closing.

    Good Luck!

  5. Reply
    Big Bully
    May 17, 2011 at 2:07 am

    Closing cost and if you can buy your rate down.

  6. Reply
    Mary B
    May 17, 2011 at 2:54 am

    You need to see the LIST of conditions for the pre-approval and if you can’t meet any of them, you need to have a talk with your loan officer immediately. ALL pre-approvals have conditions.

    There is no reason why he can’t provide that for you.

    Remember that a pre-approval and a pre-qualification is not the same thing….a pre-qualification is only income/debt ratio qualified…sometimes they don’t even pull your credit report, and that isn’t even remotely related to your ability to close.

    If your broker can’t produce that list in 48 hours, then you need to see another one.

  7. Reply
    Vlady
    May 17, 2011 at 3:24 am

    If you are in escrow than find out when they locked the rate? if they are floating the rate, than ask why? Rates change on a daily basis. Ask him who you are pre approved with and ask for the conditional approval as mentioned before. He should be asking you for documentation that will be needed to complete the transaction, Unless he is a superstar mortgage officer who had already asked you for the documentation when he initially sat down with you. ask for a good faith estimate to look at fees and actual rate, based on how many points if any you are paying, ultimately make sure he is completely up to date with latest changes in the market, there have been many.

    or
    visit us at http://www.greatwestcapital.com

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