When you are taking out a mortgage for your Colorado home, there are a number of important questions you should be asking your lender before signing on the dotted line.
Asking the right questions will ensure that the mortgage is right for you and that you are fully informed about the deal you are getting into.
Here are a few of the questions that you should be asking your lender:
What documents do I need to provide?
In order to qualify for a mortgage, you will need to show your lender certain documents such as proof of income as well as evidence of employment and assets. They will also need to have permission to pull your credit report. Ask your lender what they require so that you can have everything at the ready.
What are the closing costs?
Your mortgage will also include fees for the services that the lender provides, as well as the other parties involved in the transaction. It is important to know about these fees so that you can include them in your budget.
Can I lock in the interest rate?
Some lenders might allow you to lock in your interest rate, as it will fluctuate between the time you apply and the close of the house sale. This might cost a fee, but it could allow you to take advantage of a low rate and lock it in for the length of the mortgage.
Is there a penalty for prepayment on the loan?
Some types of loans will charge a penalty if you want to pay them off early. This could be as high as 1% of the overall loan amount, or six months of interest. However, some lenders will offer lower interest rates for buyers who are willing to accept a prepayment penalty. This is information that you will need when making your decision, as it might affect how you plan to pay off the loan.
These are just a few important questions that you should be asking your mortgage lender before making the final decision on a mortgage.
To find out more about getting a mortgage loan on a Colorado home, contact us right away.