These questions should serve to help prepare you for your meeting with your mortgage professional. Always remember that when it concerns your home every question is important and should be addressed. Don't be afraid to ask if there is something that you do not understand. Here are some sample questions to begin with:
First be sure to get the mortgage companies contact information, this includes: telephone number, email address, contact name, etc.
1. What is the interest rate on this mortgage? This is the most important figure because it will be the fee that is paid throughout the course of the loan. Depending on the term of the loan this rate may be locked for the full life of the loan.
2. Will you be provided with a "good faith estimate" showing the upfront costs as well as all closing costs you will be responsible for? A good faith estimate will show you a preliminary example of how much the loan will be for, as well as all closing costs that will be associated with it, including insurance, taxes and fees. This report is preliminary and the information will change but it is good to have an estimate.
3. Is there a prepayment penalty on this loan? A prepayment will cost you if you decide to refinance your home later or pay off the mortgage ahead of time. Prepayments may be helpful so speak with your mortgage professional to see which loan is best for you.
4. What is the minimum down payment required? Some programs offer 100% financing with no down payment (you may still be required to pay for some closing costs) but others may only be 90 - 95% or even less. Find out what you qualify for and what would best benefit you.
5. What are the qualifying guidelines? This may relate to income, credit, employment, etc. The guidelines will be what determines your interest rate as well as how much loan you qualify for.
6. What documents do I have to provide? You will need to provide W-2 forms from the previous 2 years, federal tax returns from the previous 2 years, 2 recent check stubs, documents showing other sources of income such as alimony or child support, investment records, cancelled checks for you mortgage or rent payments, etc. These are just a few examples there may be more or less things necessary for your particular situation.
7. How long will it take to process my application? This will vary depending on your situation so be sure to ask your mortgage professional.
8. What might delay the approval of my loan? This is an example of why it is critical to go over the credit report to make sure there are no discrepancies. You may do that with the mortgage company. If you provide the most accurate and complete information in the beginning it should help make the process go smoothly.
