Questions
for Your Mortgage Lender
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- Are both fixed-rate
and adjustable mortgage loans available?
- What is the interest
rate?
- How long can I
"lock-in" the financing at the current interest rate?
- Is a float down
lock available in case rates drop after I have locked in?
- What are the other
fees a lender may charge me in conjunction with my loan?
- Are funds for
a second mortgage available?
- On adjustable
loans:
- How often will
the interest rate be adjusted?
- Is there a
maximum limit on each rate change?
- How often will
the monthly payment be adjusted?
- Is there a
ceiling on payment adjustments?
- Can the term
of the loan be extended?
- What is the
maximum rate that can be charged over the life of the loan?
- Is there any
potential for negative amortization?
- Is there a
pre-payment penalty clause? This involves extra charges for paying
off the loan before maturity.
- About 80% of
all loans in the United States are paid off early.
- What is the "grace"
period? How late can a monthly payment be made before a late charge
is assessed? What will happen if a payment is missed?
- If you sell your
house, will the new buyer (if he/she qualifies) be able to assume your
mortgage at the same interest rate?
- Do you have to
pay "points" to get your new mortgage? Usually lenders charge
points for the cost of giving you a mortgage loan. A "point"
is 1% of the loan.
- Will the lender
require mortgage insurance?
- Is the loan serviced
locally or is the servicing sold?
- Ask for a written
"good faith deposit".
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