About Mortgage Loans

Buying a home can be very exciting, especially if it is your first home. But many factors are involved in obtaining a mortgage, and you should make sure you are familiar with the terms used by lenders and what they mean to you before you sign any paperwork. And you may want to consider using a mortgage broker to help you get the right mortgage a lot faster.

Beware of the word "introductory" when it comes to your interest rate. This means the percentage will go up after a certain time. Make sure you'll be able to afford your house payments throughout the life of your loan, even if you plan to sell within a few years. After all, you may not be able to sell right away, depending on the real estate market.

You can always ask the seller to pay the closing costs on your home purchase. Sometimes sellers will agree to this, saving hundreds or even thousands of dollars for you.

You can also save money by shopping around for the title company. This is acceptable as long as the lender doesn't have a specific title company that it uses. Some title companies use a sliding fee scale, and others charge a flat fee, but they all set their own rates for closing, so it never hurts to shop around.

Get the home inspected by an unbiased inspector prior to closing. This means finding your own inspector to do the job, not letting the seller take care of it. The cost can vary by inspector and home location, so again, it pays to shop around. And this is one aspect of home-buying that you should never skip - you don't want to buy a home and then find out about some deep-seated structural damage that will cost thousands to repair.

"Junk fees" are sometimes included in the closing costs so the lender can make a bigger profit. Watch for these fees in your paperwork, and do not sign unless they are removed:

• Origination fees;
• Application fees;
• Courier fees;
• Waiver fees (i.e., waiving the requirement for homeowners insurance to be paid through escrow);
• Inflated fees (i.e., a credit report that cost $29 being charged to you at $60).

You have every right to speak to the loan processor prior to closing and go over all of the closing costs. You shouldn't have any surprises when you walk into your closing. While loan processors are busy people, and they may seem irritated if you do this, don't let that stop you. A home is one of the most important purchases you will ever make, and you have every right to get the information you need.