Thinking of financing a new home?

When buying a home, applying for financing is a stressful event for a lot of people, but it doesn't have to be. Being close to various mortgage lenders in the Auburn area has helped me understand a few things that can make the loan application process very easy.

1 – Create a list of questions about your loan program

If you don't thoroughly understand the ins and outs of the various programs, make sure you bring a list of questions. I or one of my lender contacts will help you understand the advantages and disadvantages of each one, because it is a challenge to understand the differences between both fixed and adjustable rate mortgages.

2 – Decide when you want to lock

By locking in the interest rate, your lender is guaranteeing the mortgage interest rates for the loan – generally at the time the loan application is sent in. By floating the rate, you can lock the rate anytime between the loan application day and closing. Those who elect to float think that the interest rates will decline in the near future. Click here to see the outlook for the next 90 days of interest rates.

3 – Decide if you want to pay additional points to decrease your rate

Generally you can decide to pay additional points to lower the interest rate of your mortgage loan. Every point is 1 percent of the mortgage loan and is payable in cash at closing. To decide if purchasing points is right for you, click here to use our points calculator.

4 – Gather your paperwork

Obtaining a loan requires a lot of paperwork, so you should spend some time getting your documentation together. Click here for a list of normal loan documentation.

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