As you set out to begin your homebuying adventure, you likely put a lot of time and thought into choosing your real estate agent. You recognized the value of partnering with a professional who would help guide you to a successful home purchase, and you may have even interviewed several before selecting the one you felt was right for you.
In the same way, you should also be thorough and selective when identifying the right mortgage lender for you. A great starting point would be to seek out top recommendations from your real estate agent, friends and neighbors. Then, schedule time to chat with a mortgage lender from your top picks to help you determine how to get the best mortgage loan for your situation. Here are some valuable questions you should ask these mortgage lenders throughout the selection process.
How can you help me stand out to sellers?
Even though the frenzied buying market of the pandemic days are behind us, home inventory is still low, putting buyers in competition with each other. While sometimes that means putting forth a larger down payment or more earnest money, your mortgage lender can provide another key to getting your offer noticed.
One significant way they can help is by pre-approving you for your loan and providing a letter of pre-approval. Once your loan is approved, the lender can provide a letter that states your approved status, and some may even reach out to seller agents to express a willingness to close swiftly.
Can I lock in my mortgage rate?
Even with a pre-approval in hand, don’t assume the rate available the day the pre-approval was issued will be the rate you secure at closing. Typically, you would have to wait until you have an accepted offer in order to lock in the rate, so once you have that you will want to discuss options with your lender.
Locking in your rate helps ensure that you don’t sit down at the closing table with an unwelcome surprise in the form of a higher rate, which can make your overall borrowing costs increase. As you discuss your rate-lock options, including the length of time the lender can lock in your rate, you should also inquire about any associated rate lock fees and whether you will have the option to “float down” the locked-in rate if interest rates go down by the time your loan is finalized.
Can you guarantee an on-time closing?
Working with a lender that prioritizes your timelines is a must. At Meritrust, we understand how critical this timing can be and how diligent all invested parties must be to get it right. The seller relies on the closing to receive funds they may need to purchase their next home quickly after closing, and as the buyer, you rely on an on-time closing to be able to coordinate your own move. The failure to have your closing on the agreed-upon date can cause huge ripple effects for buyers and sellers and even result in extra costs associated with moving or additional financial transactions required. For this reason, it is important to ask mortgage lenders if they can guarantee closing on time and how you can help ensure that happens.
What are the estimated closing costs and fees?
Closing costs are always a concern for buyers, and rightfully so. These costs can vary widely from one lender to another because some may charge origination and other fees, or offer higher rates to offset low fees. While you may not be able to get a black-and-white answer on every detail of your anticipated closing costs before application, you can ask a mortgage lender to walk you through their fees and how much you can expect to pay for them.
Do you do your underwriting locally in-house?
When you can, working with a mortgage lender that does their underwriting locally and in-house can be beneficial to you. This is because the lender often has more flexibility in working with borrowers when they are able to make their lending decisions locally, rather than having to defer to a national headquarters for loan decision-making. It also streamlines communication between you and the lender as you work through the process, removing the underwriting “middle man.”
How long does your underwriting process take?
The mortgage lending process is complex, requiring numerous steps, multiple professionals and teams to complete. Even so, the right mortgage lenders have this process down to a science and can work efficiently to complete underwriting with minimal delays, especially if your lender and underwriter work together. Be sure to ask the mortgage lender about this timeline and how they ensure it is handled smoothly.
While you are shopping for mortgage lenders, be sure to meet with Meritrust’s Home Loans team. We will strive to meet your every need while exceeding your expectations. Get pre-approved or learn more about our team now.
