3 Questions to Ask Your Lender
Every major sales transaction requires a consultation and a home purchase is no exception. Stay in control of your mortgage by asking your lender the following questions:
1. How long will this take?
It looks harsh at first glance, doesn’t it? But in reality it’s a question that will give you a reality check. Many borrowers are bombarded with ads from lenders who guarantee closing in a certain number of days, but each loan application is different and requires varying lengths of time to process. Ask your lender for an estimate of time before you find yourself growing antsy!
2. Will I be penalized if I pay off my loan early?
Early repayment penalties are in place because paying off a loan before its due date results in less interest paid to your lender. It sounds greedy, but interest keeps our operation running. While we try to secure the lowest mortgage rates possible for our customers, it’s quite a blow to hear they’ve repaid an entire loan so quickly that our slow accruing profits have officially been cut off. The early repayment penalty covers those losses.
3. What are my closing costs?
Always ask us for a GFE or Good Faith Estimate. GFEs detail all of the extra fees that are required at loan closing. You will not only want to understand each cost for your own peace of mind, but also your wallet. Do not be one of those borrowers who thinks money for a down payment is enough to cover an entire home purchase – there are always extra fees for those people who work hard to get your loan closed in a timely fashion.