Buying a home is a major financial transaction, especially if you’re going to need mortgage financing to help cover the purchase cost. The only way to know if you’re getting the best deal on a mortgage is to shop around, but with so many different lenders vying for your business it can be very tough to choose which mortgage is the best fit for your own situation.
In this post we’ll share how you can compare mortgages from different lenders or underwriters so that you can get the best possible deal on your mortgage loan.
Start By Comparing Interest Rates
The most important factor in your mortgage is the interest rate that you’ll be required to pay so this should be your starting point. While most lenders will keep their rates competitive with one another, you may find that there are discounts available based on your credit or financial history. You might also find that some lenders are willing to adjust the rate based on how long of a mortgage term you’ll need, and how much you’re investing in your down payment.
Get An Estimate Of Your Total Closing Costs
While the number that you’re most likely focused on is the total monthly payment that you’ll be making for the next few years, you’ll also want to find out how much in fees and closing costs you will have to pay in order to take out the mortgage. Every lender charges different fees and the amounts can vary wildly, so be sure to get an estimate on these costs to find out how they’ll affect your home purchase.
Watch Out For Early Payment Penalties
Finally, you’ll want to keep an eye out for early repayment penalties as these can cause you a headache later on if you decide you want to pay your mortgage off a bit faster. The ideal mortgage is one that allows you to repay the principal amount at any time without facing a penalty, but depending on the other terms that you require you might need to shop around a bit before you find a mortgage like this.
You may find that comparison shopping can be a bit overwhelming with so many different mortgage options, terms and interest rates to choose from. If you have questions or you need help sorting through it all to determine which mortgage suits you best, contact your local mortgage professional today to book a quick consultation.