Sent to you courtesy of:

Sandy Tower, Broker Contact Sandy: sandy@sandytower.com Toll Free: 1/877/964-5800

Associated with:

Dickerson & Nieman, REALTORS®, 6277 E Riverside Blvd, Rockford, IL 61114       815/381-1195 

AS BUYERS WE SHALL… Many of us pay too much in interest for our homes, and we are clueless as to knowing whether or not it is the best financial decision for us. We would do better if we avoided the following errors:

 

  1. It is important that we have a relationship with a lender who knows our circumstances and can advise us as to the best choices for our situation.
  2. We shall learn how to shop for a mortgage. Asking about lock options, miscellaneous fees, annual percentage rates, or what other programs the lender might have that would save us money.
  3. We shall understand the issue of private mortgage insurance. When we put less than 20% down on a home financed with a conventional mortgage, we are charged with private mortgage insurance. This insurance can be purchase through 6 or 7 major insurance carriers, with many options, which could cost thousands of dollars.
  4. We shall check out the qualifications of the lender, ask for experience and background, ask for references and training and length of time in the business.
  5. We shall ask about mortgages in general and learn how certain choices may affect our financial situation with a gain or a loss. We shall ask about various options i.e. paying points, refinancing later, various adjustable rate programs, etc.
  6. We shall understand how refinancing will affect the long-term consequences of our home investment. A lower payment sounds attractive, but do we consider that this lower rate slows down the process of building equity in our home? We should be anxious to reach 20% equity, so we can eliminate the private mortgage insurance.
  7. We shall understand that a mortgage loan approval increases our bargaining power with the Seller. Getting a mortgage after we sign a contract is doing the process backwards. Especially if there are any problems. With plenty of time we can solve problems and remain in a good bargaining position.
  8. We shall learn that lock options are as important as interest rate options. Many lenders have 10 – 90 days locks options—some of which may cost money up-front. We shall ask our lender to carefully explain our options and how that will affect our total interest payments.
  9. We shall learn if lenders service their own loans. Some send their loans to other lenders for processing or approval. Some service their own loans. Others sell most or all of the servicing.

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