What Questions Should I Ask My Mortgage Broker Before Closing?
Buying a home is one of the largest financial transactions in most people’s lives, so it’s important to have the right mortgage for your needs. Not every lender will offer the same types of loans and terms, so it’s essential to do your homework when looking for a lender.
You’ll also want to make sure that you have an experienced and trustworthy mortgage broker by your side, so that they can guide you through the process. They’ll help you answer some of the most common questions, and give you an idea of how to find the best lender for your needs.
What Are My Closing Costs?
It’s important to ask your mortgage broker what the total amount of money you’ll need to pay for your loan. This includes any pre-paid items (like property taxes or homeowners insurance) as well as the closing costs shown on your Loan Estimate, which they’ll provide to you in advance.
The Closing Disclosure is another piece of paperwork that your mortgage broker will prepare for you, which will detail all of the closing costs and other fees that you’ll be responsible for. It’s important to understand this information so that you can ensure that you have enough cash on hand to complete your transaction, or so that you know what you might need to do to make the deal more affordable.
Will I Have to Pay Private Mortgage Insurance?
PMI is an additional expense that many lenders will charge borrowers who don’t put down at least twenty percent of the home’s purchase price. This extra insurance is a great way to protect your lender in the event that you default on your mortgage.
A mortgage broker will be able to explain the process of getting this insurance, so that you can see what your monthly costs will be before committing to any type of financing. This is a good opportunity to ask your mortgage broker if they can handle the underwriting for you, or if you’ll need to do it yourself.
Will I Be Able to Get a Mortgage Rate Lock?
Getting an interest rate lock is a great way to ensure that the interest rate you’re approved for will remain the same until you close on your mortgage. Be sure to ask your lender about current market rates, how long the rate lock will last and if they’ll charge you any sort of fee for it.
Are You a Good Fit?
If you’re a first-time homebuyer, it can be overwhelming to try to figure out which loan will work best for you. Your lender should be able to walk you through the different options available, including government-backed and conventional loans. They’ll also be able to tell you how much down payment you’ll need and which loan types are better for your situation.
Is It Easy to Refinance?
Refinancing can be a great way to save on interest and pay off your mortgage more quickly. But it’s not something to rush into, so be sure that your lender is willing and able to talk you through the process, as well as the fees and requirements associated with refinancing.