Using ForTheBestRate.com to Shop for Purchase Financing Assistance
The fast paced real estate market across the United States makes it necessary to obtain home financing quickly and efficiently. ForTheBestRate.com provides information on mortgage bankers, brokers, lenders, and credit unions that specialize in residential home loans. They offer a wide variety of fixed and adjustable rate mortgage programs with competitive rates and closing costs.
If you are in the market for a new home, call one of the companies in the rate survey on this site for a consultation.
The Majority of the Companies on ForTheBestRate.com’s Rate Tables Have:
- Access to very competitive mortgage rates and closing costs – Check Today’s Rates
- Traditional fixed rate products and flexible adjustable rate mortgage products
- Variety of low money money down and 100% mortgage financing programs such as FHA mortgages and VA loans.
- Programs for 1-4 unit primary residences, second homes, and investment properties.
- Loan products popular with first time buyers which often have limited reserve requirements and flexible down payment alternatives (i.e. FHA loans, VA mortgages, and USDA rural housing loans.
6 Questions to Ask When Weighing Financing Options
Purchasing a home is a big commitment. With so many types of home financing programs out there, choosing the wrong one could make that commitment difficult to keep up with. Before you commit yourself to a loan, which is a binding contract, ask yourself these five questions:
1. How long do you plan to live in the home?
Determining the length of time you plan on residing in a home can help you decide which type of loan is best for you. Are you just looking for a starter home, or are you in this for the long-haul? If you don’t see yourself living in the same home for more than 5 years, a 5/1 ARM may be your best bet. If you can see yourself retiring in the house you’re about to purchase, you could be better off choosing a 20 or 30 year fixed rate loan.
2. Are you more concerned with low monthly payments, or paying off the loan quickly?
When it comes to short-term loans (like 15 or 10 year mortgages), your monthly payments will typically be higher; however, as a trade off, you will be paying more toward your principal. This leads to the loan being paid off sooner than it would be if you were in a 30 year mortgage.
3. Are you OK with the risk of a rising interest rate?
A popular mortgage choice for some borrowers is the 3/1, 5/1 or 7/1 ARM, or Adjustable Rate Mortgage. These loans generally offer a lower-than-average interest rate for the beginning period, but that rate will change once a year for the remainder of the loan. Keep in mind that while the rate may not necessarily go up, you must be financially prepared should an increase occur.
4. How much of a down payment/equity in the home do you have?
If you’re strapped for cash and can’t put much toward a down payment, a low or no money down home loan could be the right choice for you. The Federal Housing Administration offers a variety of loans (FHAs) for qualified borrowers who lack the necessary funds for a down payment. If you’ve been able to save up a good chunk of change to put down, or if you have established equity in your current home, you’ll have even more options available to you.
Some borrowers may find that they have particular qualifications that allow them to apply for special loans with extra benefits. Military members, for instance, may qualify for a no money down VA loan while those looking to purchase in a rural area could get special financing with low interest rates.
6. How will you finance the costs of necessary home repairs?
Buying a home can be expensive and it’s not uncommon for issues to arise in home inspection reports which can make properties ineligible for many conventional financing solutions. If you’re looking at properties that you know are going to need some work and/or you have plans of renovating the property after closing, you might want to spend some time researching 203K loans. These loans are designed to help borrowers pay the costs of many home improvement and rehab projects without the need for a second mortgage.
After you have asked yourself the following questions, talk to your mortgage adviser and begin your journey to homeownership.
Order of Events for the Home Buying Process
When buying a home it’s easy to get excited about a home listed for sale. Prospective buyers often call the number on the yard sign or email the listing agent, schedule a viewing of the property, and find themselves midway into the home buying process without knowing quite how they got there. Follow the home buying order of events listed below for a smooth process, and to find a home that’s right for you.
Step 1: Get Preapproved for a mortgage.
Find out what you’re preapproved to borrow before you start looking at listings so you can have a good idea of the price range of homes you can look in. Having a pre-approval letter from a mortgage company when you make an offer will help show the sellers that you are a serious buyer and will be able to qualify for financing if they accept your offer. This also gives you the opportunity to get to work correcting any mistakes on your credit report or gathering required documentation – both of which may be revealed during the pre-approval process. Waiting until you are under contract to address these items could be expensive, stressful, and possibly even cost you the deal.
Step 2: Determine your budget.
Use the amount you are preapproved to borrow as the high point when figuring out what price range to shop in, but it is likely you’ll end up shooting for a number much lower. What the mortgage lender will approve is not the same as what you can afford. Take a realistic look at your budget, income, and savings and come up with what you can afford in a monthly mortgage payment. Keep in mind you will also have to pay taxes and insurance on the property, and that it’s smart for home owners to set aside additional savings as a home repair emergency fund.
Step 3: Interview real estate agents.
Don’t just go with the agent you met at an open house or the listing agent on a home you like. Meet with a few well-respected buyers agents in your area to find one that you feel will do a great job for you. Ask questions about their negotiating style, how many properties they generally show a client, and what times they are available for showings.
Step 4: Go find your home.
Once you’ve selected a real estate agent it’s time to start what many people think of as the beginning of the process – looking at available homes for sale. Think through which aspects of a new home are most important to you and share this list of priorities with your agent. Once you’ve found the right home at the right price it’s time to make an offer!
You will work closely with your real estate agent and mortgage originator through the rest of the process which includes negotiating and executing the purchase contract, arranging the mortgage loan, having the property inspected (and repaired if applicable), and closing the deal.
When Choosing a Mortgage Professional, Make Sure You’re Prepared
When it comes to selecting a mortgage company, it pays to do some shopping around. Some lenders will promise you the lowest rate and others will swear that their service is heads and shoulders above the rest. Other people listen to their real estate agent’s recommendations and go with their agent’s preferred lenders despite the fact that the agent may not care about what rate their customer is being offered. Some agents truly look out for their clients and others just want to make sure that the deal gets done no matter what rate their client pays. Your goal should be to find the right mix of rate, service and dependability.
Here are some suggestions on choosing a mortgage company and a mortgage professional:
- Ask your friends and family for referrals for companies that have served them well.
- Call your local bank for a quote and then call several lenders and/or brokers and make sure that your bank is offering you a reasonable quote.
- Request Good Faith Estimates and Truth-In-Lending Statements and be sure to compare the fees in the 800 section of the Good Faith Estimate and the APR in the Truth-In-Lending statement
- Ask your Loan Advisors for references
- If you are working with a real estate agent, request a quote from the professionals that they recommend and then shop around. If you decide to not use their recommended lenders or bankers, make sure that the agent and the mortgage company you choose are on the same page.
- Be sure that the company is willing to send you a rate lock confirmation once you lock your rate.
- Trust your gut. If it sounds too good to be true, it probably is.