Applying for your home loan

A lot of people think applying for a loan is one of the more stressful elements of purchasing a home, but it doesn't have to be. I'm pretty close to many lending companies in Auburn, and they've helped me learn a few things that make the loan application process pretty simple.

1 – Put together a list of questions regarding your loan program

If you don't completely realize the advantages and disadvantages of all the various programs, be sure to have a list of questions with you. It's hard to understand the differences between both fixed and adjustable rate mortgages. I or one of my lenders will be able to help you understand the advantages and disadvantages of each.

2 – Determine when to lock

Locking in a rate signifies that a lender guarantees the interest rates for the loan – ordinarily at the time the loan application is submitted. By floating the rate, you can lock the rate anytime between the day of your loan application and issuance of closing documents. Those who decide to float conclude that interest rates will drop in the near future. Click here to see the outlook for the next 90 days of interest rates.

3 – Determine if you want to pay additional points to reduce your rate

Normally you can opt to pay additional points to lower the interest rate of your loan. Each point is 1 percent of the loan and is payable in cash at the time of closing. Click here to use our points calculator. This tool will help you decide if purchasing points is right for you.

4 – Compile your paperwork

Acquiring a loan requires lots of paperwork, so you should spend some time getting all your documents together. Click here to get a list of typical loan documentation.

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