Show me the MORTGAGE money!

10 Questions Borrowers should ask when shopping for a mortgage...#1

Can I lock in the rate?   Beware the salesperson who tries to talk you out of a rate lock because "rates will be going down soon." First, their cyrstal ball is no better than yours, and they have no idea in which direction rates are headed. Second, if they can convince you to float the rate, they are then free to low ball the quote, knowing that they can not be compelled to deliver it.

...10 questions borrowers should ask when mortgage shopping...#10

..How quickly can you deliver a written commitment?...The KEY word here is "Commitment"...a year or 2 ago that was an easy question to answer. If the lender was sophisticated enough to be using automated underwriting, in most instances, they ought to be able to deliver a commitment within 24 hours. Today, impossible. period.

First of all, in NJ, you cannot use the word "commitment" without having an appraisal(its illegal), and the appraisal is going to take at least a week.

Combine that with cautious underwritering, new government regulations, and tighter credit policies, and we are realistically looking at 2 weeks to 30 days.

The good news is that the market realizes this, and expectations have adjusted. Still it is best to pick a lender that has local underwriting, and doesn't have to ship the file to East Gibbip Minnesota, and cannot even talk to the underwriters.

SUGGESTION FOR BUYERS: Get a mortgage CREDIT APPROVAL BEFORE you go shopping for a house. This is a complete underwriting review and approval by the lender just short of an appraisal. Then, when you find a house, all you need is the appraisal. This I can do in 24 hours.

..10 Questions borrowers should as when shopping for a mortgage...#9

...Are you FannieMae or FreddieMac approved? Both these quasi government agencies have strict membership and net worth requirements.

..10 Questions Borrowers should ask when mortgage shopping...#8 Should I pay

points? The question to ask yourself is how long will I be in the property? If you intend to be there more than 4.5 years it makes sense, if not it doesn't.

...10 Questions borrowers should ask when mortgage shopping...#7

...How fast can you close the loan, and are you the company closing my loan?  If you have a tight schedule choose your lender carefully. A broker, or internet information service usually has very little to do with underwriting your loan, and virtually nothing to do with closing it. At 1st Constitution we are direct lenders and we close your loan in our name with our money.

...10 Questions borrowers should ask when mortgage shopping...#6

...Are there any other fees? ...Such as commitment fee, discount, origination, warehousing, appraisal, processing, underwriting,etc. Not all lenders charge the same fees.

..10 questions borrowers should ask when shopping for a mortgage.. #5

.....Is the lock in fee refunded at closing? If the fee is not refunded at closing this fee is a finance charge and effects your rate.

..10 questions borrowers should ask when mortgage shopping..#4

..Is there a lock in fee? A fee charged to lock in the rate. This would effect your APR.

10 questions borrowers should ask when shopping for a mortgage #3..

... When can i lock in the rate?  At 1st Constitution we can lock you in at application, and our 60 day rate lock is free. Most reputable lenders allow you to lock a rate from application right up to a week prior to closing. Beware the lender that will not allow the rate to be locked until commitment, or even closing. Special note: due to recent implimentation of new government regulations, locking in the rate after application requires the lender to issue new disclosures (Good Faith Estimate, and Truth in Lending). The borrower must have 3 business days to review these new disclosures. This can effect timelines and closing dates.

...10 questions borrowers should ask when shopping for a mortgage..#2

...For how long can I lock in the rate? Lockin quotes of 15 or 30 days should raise a red flag. While it is possible to close in 30 days, it is highly unlikely, especially given the new regulations handed down from Washington. Most closings take place within forty five to sixty days. So although many advertised rates may be technically accurate, for all intents and purposes they simply do not exist.