What To Ask Your Lender When Buying A Home

When looking at homes for sale in Dallas, one of the key things that you will need to decide before pulling the trigger is who you are going to use as a lender. Once you have found a lender that you feel comfortable with, it is a good idea to prepare a list of questions. Here are six of the best questions to ask your lender so that you feel confident heading into this important transaction.

What Types of Loans Are Best for My Needs? A professional lender should be able to look at your specific needs as a borrower and recommend loan types based on your personal specifications. A good lender will be able to explain the differences between conventional mortgages, FHA loans, VA loans, and other types of options available to you. You should feel confident that your lender understands your personal situation enough to make the best recommendations for you.

What Documents Should I Gather? There is no doubt that there is a significant amount of paperwork involved with getting a home loan. While there is no way around this hassle, your lender is there to guide you through this process and ensure that you have the proper documents ready to go. The most common pieces of information that you need include identification, income proof, bank statements, and other financial accounts, and property documents.

Are Loans Approved In-House? Not all mortgage lenders are able to approve loans in-house. Some lenders are required to get approval out-of-house, which may complicate the process. Understanding the constraints that your lender candidates may have will help you to make a wise choice for your needs.

What Are All of the Fees? You are not alone if your head starts to spin when you look at all of the various fees involved with obtaining a mortgage. Fees that you need to be aware of include the origination fee, closing cost estimations, costs to lock in the interest rate, and other terms. Your lender should walk you through all of these fees and put them on paper for you.

What is the Amount of the Loan Down Payment? One vital question to ask your lender is what is required for the down payment. While 20% is the traditional rule of thumb, some lenders will give you more flexibility with this figure. Many lenders require as little as 3% down to lock you into your mortgage.

What Are My Interest Rate Options? Understanding your interest rate options will help you to understand what your monthly payments will be for the home. You also need to understand the terms of the annual percentage rate (APR). This number takes into consideration both the lender fees and the interest rate and divides that total by the terms in your mortgage to give you a more accurate picture of your financial commitment.