A No Headache Closing Is Doable

By DerrickR.Cockrell

All you see today are ads for the lowest mortgage rates around. How do you steer clear of the lenders who just have come on ads designed to lure you to their site from the ones that you are going to get the most advantageous deal from?

If you want to avoid being fooled by such ads, be sure you know your lender well. If the mortgage company or broker is a company that is not known to you, make sure you get all of their details. You can verify them with the Better Business Bureau or the state banking commission to find out if they have had many complaints against them.

The next step is to be sure you are working with a broker who has experience in the kind of loan you are interested in. In addition, you should make sure the bank has a lot of experience in the field. If you deal with an established, reputable firm, it is unlikely that there will be any problems at the closing.

Find out as much as you can. As much as the internet has inundated us with information, it has also made it easier to get the information that we require. But it is important to understand all of the various types of loans out there and what terms are available. It is best to make a thorough list for comparison purposes.

Another thing to consider is who the rates you are getting apply to. Frequently the brokers will advertise great rates, but it turns out they only apply to top rated borrowers, and everyone else pays more. Therefore you have to get the premiums over the quoted rate that will be applicable for you.

Once you have the average rates on offer, you can ferret out the scams. Remember the old saying, if its too good to be true, it probably is not true. You are sure to find some variances in rates, but if one lender is inordinately lower than the others, this should be a red flag for you.

Don't be forced. If a broker does not take his time to explain, and allow you time to decide, cross him off your list. If you don't understand, keep asking until you do. Avoid any broker who is not willing to answer your questions.

Once you are clear on the terms, get them in writing. Be sure all of the terms are in this document; a broker should not tell you "we'll work that out later". In the case of an adjusted rate home loan, the index the ARM is fixed on should also be in the agreement. Check to make sure that the terms of any lock in period are in the agreement. Make sure this document is on proper letterhead and is signed by an officer of the organization. The vast majority of headaches that come up at a closing are because some points were verbally understood.

When you receive the written agreement, read it and understand it. Don't let the lender to put in legal language that you do not understand. If anything is not clear, have it reworded, or make notes as to the explanation to make sure it agrees with your interpretation. Once again, if the lender is not willing to do this, walk away.

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