Scott Berry's blog : Getting A Mortgage: Five Ways To Have It

It's important to be a smart mortgage shopper in today's sellers and refinancing sector. It's important to know what to look for when borrowing a huge sum of money. Here are a few short pointers to help you make the best decision possible when it comes to your home loan quest.

1. Know Your Terminology

The mortgage universe can be very overwhelming and daunting for many first-time home buyers (or even those who have had a mortgage for many years). The good news is that if you understand a few main words, it's not so grim. Before you begin, there are a few things you should be aware of.

Loan Types. The VA Loan (only available to eligible veterans), FHA Loans (popular with first-time home buyers due to low down payment requirements), Conventional Loans (the most common loan alternative - includes a 20% down payment), and ARMs (adjustable-rate mortgages are ideal for people who feel they won't be in their home for more than a few years) are your key choices.

Repayment Terms. You'll have the option of going between a fixed interest rate that won't vary throughout the loan and an adjustable-rate that starts low over the first five or seven years and then changes to the normal interest rate per year after the fixed term ends.

2. Points

Points are an essential part of the mortgage process that every smart shopper should understand. You'll find the points aren't as daunting as they seem until you do some testing. They are essentially prepaid interest and can be very beneficial to anyone who intends to remain in their home for a long time.

3. Mortgage Rates

We are living in one of the highest mortgage interest rate markets in history, which is one of the key reasons that so many Americans are considering buying a house or refinancing. It's important to do your homework and make well-informed choices, but you'll still want to lock in your mortgage rate when interest rates are still at record lows. And if interest rates rise when you're still in the process, you'll still get your low rate.

4. Get Your Finances and Credit in Order

One of the most underappreciated facets of the mortgage process has little to do with mortgages. Before you agree to any mortgage, have a free credit check and clear up any delinquencies, since this will help you lock in the lowest rate possible. Often, make sure you check your schedule to see if you can handle the monthly bill. See if you can make additional payments per month or year if you can. You'll be surprised by how easily your debt will be paid off and how much less interest you'll incur throughout your loan.

5. Work with a Lender You Trust

It's just as critical to choose the right Home Loan Expert as it is to choose the right loan or interest rate. Working with a reputable lender will save you a lot of time and money in the long term. Check out your lender's mortgage lender feedback to see what actual customers have to say about the company.

If you've mastered the fundamentals, you should be good enough to start looking for the first mortgage or refinancing the current one. Remember not to get too caught up in the process. This should not be a challenge if you choose the right lender, and you'll be in your new home (or loving your lower monthly payment) in no time.

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