If you’re planning on buying a house, you need to make sure you understand every part of the mortgage loan process in advance. Your loan officer is the person you can trust to give you accurate, thorough information about all aspects of your mortgage loan. Not sure what to ask? Here are 15 questions you can ask your mortgage lender to help you understand everything you need to know.
Will you walk me through the mortgage loan programs your offer?
There are many loan programs out there, and you need to know your options. Your loan officer can go over the mortgage options available to you, how they work, what they cost, and all the requirements for getting approved.
What are your required credit qualifications?
Almost all loan programs require a credit check to measure your credit worthiness. Even if you don’t have a high credit score, there may still be loan options for you. Your mortgage lender can explain your credit score and the loan programs available based on it. The higher your credit score, the more options you’ll enjoy, so keep it as high as possible.
What are your income requirements for getting a mortgage loan?
Income is key in getting qualified for a mortgage. Knowing how much income you’ll need prepares you in advance for paying your monthly mortgage payment.
Can you pre-approve or pre-qualify me?
Being qualified or approved early in the process helps you be more competitive when you’re trying to buy a home. Your loan officer can tell you the steps for getting pre-approved for a mortgage.
What is the interest rate?
Your interest rate affects your monthly mortgage payment and the total amount you’ll end up paying for the property. Your mortgage lender can look at your credit, income, and other factors and tell you the approximate interest rate you can expect to pay for your loan.
How much do I need to pay down?
Some loan programs require a down payment of 20%, while other ones don’t require anything down. When your loan officer dives into the type of loan that fits you best they can talk to you about the down payment requirements.
Do you offer down payment assistance?
Your loan officer can tell you if you qualify for government or local grants or employer programs to help you with your down payment.
Can I Borrow Money For a Down Payment? Read this article to help better understand your options.
What amount of loan do I qualify for?
Mortgage lenders make their lending decisions by looking at your financial history, debt load, employment, and income and measure them all to decide what the amount is that you can borrow. Knowing this before you shop helps you stay within your budget.
How much will my monthly payment be?
Based on the loan you choose and your mortgage amount, your loan officer can calculate an estimate of how much your monthly mortgage payment will be.
Can I get a mortgage rate lock?
Since mortgage rates can fluctuate, if you can snag a low interest rate, do it. Ask your mortgage lender what it takes to lock in a rate and how long you can lock it.
Do you offer mortgage points?
Sometimes it pays to “buy” mortgage points to get a lower interest rate. Your loan officer can tell you if they offer points, and if buying them is a good move for you.
How long will it take to get my loan closed?
It can take 1 to 2 months to get everything squared away and arrive at the closing table. Ask your loan officer to lay out a timeline of the mortgage process, so you’ll be prepared.
What is my loan estimate?
You should receive your loan estimate within 3 days of completing your loan application. It provides detailed information about the mortgage you’re getting like the repayment terms, interest rate, and closing costs. Read it thoroughly and ask your loan officer to explain any details you don’t understand.
How much will my closing costs be?
The buyer is usually responsible for the closing costs. These can be a big expense depending on your loan program. Your loan officer can advise you how much your closing costs will be (they are usually 2-6% of the loan amount), if you should try to get the seller to split them with you, and whether to pay them at closing or roll them into your loan.
Will I need mortgage insurance?
If you pay less than 20% down as a down payment, you’ll be required to add private mortgage insurance (PMI) on your loan. Your loan officer will be able to give you the details about what PMI is, how much it is, and whether you will be required to have it.