Top Ten Mistakes When Financing Real Estate

FOR IMMEDIATE RELEASE
(Free-Press-Release.com) December 1, 2008 -- Financing a home
1. Looking for a home without being pre-approved.
Pre-approval and pre-qualification are two different things. During the pre-qualification process, a loan officer asks you a few questions, then hands you a "prequal" letter. The pre-approval process is much more thorough. During the pre-approval process, the mortgage company does virtually all the work associated with obtaining full-approval.
2. Making verbal (oral) agreements!

If an agent tries to make you sign a written document that is contrary to their verbal commitments, do not do it! Get it in writing!
3. Choosing a lender because they have the lowest rate. Not getting a written good-faith estimate.

While rate is important, you have to consider the overall cost of your loan. Pay close attention to the APR, loan fees, discount and origination points. Some lenders include discount and origination points in their quoted points. Other lenders may only quote discount points, when in fact there is an additional origination point (or fraction of a point). This difference in the way points are sometime quoted is important to you. One lender will quote all points, while another lender may disclose an extra point, or fraction thereof, later: an unwelcome surprise.

Within 3 working days after receipt of your completed loan application, your mortgage company is required to provide you with a written good-faith estimate (GFEs) of closing costs. You may want to consider requesting a GFE from a few lenders before submitting your application. With a few GFEs to compare, you can get a feel for which lenders are more thorough, and you can educate yourself regarding the costs associated with your transaction. The GFE with the highest costs may not indicate that a particular lender is more expensive than another is; in fact, they may be more diligent in itemizing all fees. The cost of the mortgage, however, should not be your only criteria. There is no substitute for asking family and friends for referrals and for interviewing prospective mortgage companies. You must also feel comfortable that the loan officer you are dealing with is committed to your best interests and will deliver what they promise.
4. Choosing a lender because your Realtor® recommends them.
Your Realtor is not a financial expert. He or she may not know which loan is best for you. Your Realtor® gets a commission only when your transaction closes. As a result, the Realtor® may refer you to a lender who will close your loan, but who may not have the best rates or fees. Also, many Realtors® refer you to one of their friends in the loan business, who also may not have the best rates or fees. Although most Realtors® are professional and concerned ab

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