Inglewood Business Magazine July-Sept
First Edition Final.pdf
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INGLEWOOD<br />
BUSINESS MAGAZINE<br />
After mortgage rates stayed surprisingly low in 2014, who knows how they will<br />
shake out in the new year? Either way, borrowers who want to refinance or buy a<br />
home have the best chance to get the lowest rate by knowing more, not less, about the<br />
mortgage game. These 10 tips can help you navigate the mortgage process in 2015.<br />
1 . Don’t buy a home beyond your<br />
budget. A home should be a source of<br />
investment not a financial heart ache,<br />
especial for first-time buyers.<br />
Borrowing from family members<br />
and living from pay check to pay check<br />
makes for larger mortgage payments<br />
and bigger risks in the future.<br />
2. Always be on the lookout for<br />
competitive rates, points and fees.<br />
Compare different bids.<br />
3. Obtain an immediate<br />
confirmation of your locked in interest<br />
rate terms, point and fees.<br />
4. Never agree to prepayment<br />
penalties. If there is no mention of<br />
prepayment penalties, make sure you<br />
have an addendum attached to the<br />
mortgage that specifically states that<br />
no other penalty fees will be added.<br />
5. Know all that you can about your<br />
loan! Ask thorough questions and<br />
seek advice from professionals that<br />
you trust.<br />
6. Pick the right kind of loan. Rates<br />
are higher on 30 year loans than on<br />
comparable 1 5 year loans. Lenders<br />
hate holding loans at below market<br />
rates. Try considering “hybrid” loans<br />
–those with a fixed rate for the first five<br />
or seven years of their 30 year<br />
duration. If you’re going to be in your<br />
home for a shorter period consider an<br />
adjustable rate mortgage.<br />
7. If you are buying rather than<br />
refinancing, consider getting preapproved<br />
mortgage or contingent loan<br />
approval letter. Pre–approval can<br />
strengthen your negotiating position<br />
with the seller, however it can add<br />
pressure on you to close a deal before<br />
the loan commitment expires. A<br />
contingent approval is a letter from the<br />
lender that states that the largest loan<br />
that you would qualify for. It will also<br />
give you additional negotiating<br />
leverage without binding you to the<br />
lender or the lender binded to you.<br />
8. Save all of your documents!<br />
<strong>Inglewood</strong> <strong>Business</strong> <strong>Magazine</strong> <strong>July</strong> - <strong>Sept</strong>ember 2015<br />
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