If you are a prospective homebuyer or a homeowner interested in a refinance, one of the most important steps to take is to find a lender. Not only do you want to find a responsible, reputable lender, but you should also check each lender's current mortgage rates. You can find a list of lenders by state with their current mortgage rates on the HSH.com's lender showcase.
Current mortgage rates and local lenders
While some lenders are licensed to approve loans in every state, not every lender can offer loans in every area. Start by searching for a local lender so that you can be sure you are working with someone who understands the financing and settlement requirements in your state. Then compare current mortgage rates among lenders.
Questions to ask your lender
As a borrower, you should consider contacting two or three lenders to make sure you are getting the best deal. Make sure you compare loan programs and understand the differences between various loan offers. It is important not only to check current mortgage rates, but also to determine whether you will need to pay points in order to qualify for a particular rate.
Here are some questions you should ask each lender about the loan you are offered:
- Is this an adjustable-rate mortgage or a fixed-rate loan?
- What is the minimum down payment requirement for this loan?
- Will I need to pay points at closing to get the quoted rate?
- Will I need to pay private mortgage insurance?
- What will my entire monthly total be, including principal, interest, taxes and insurance?
- Is there a prepayment penalty on this loan?
- How long can I lock in the interest rate?
The key to financing your home and being comfortable with your monthly payment depends on the loan's interest rate and your personal understanding of any risks the loan might pose.
Michele Lerner contributed to this answer.
A 25-year expert observer of the mortgage and consumer debt markets, Keith Gumbinger has been cited in thousands of articles covering a wide range of consumer finance and economic topics in outlets ranging from the Wall Street Journal to the Bottom Line newsletters. He has been a featured guest on national broadcasts for CNN, CNBC, ABC, CBS and NBC television networks and has been heard on NPR and other national and local radio programs. Keith is the primary researcher and writer for HSH.com's MarketTrends newsletter and has authored or co-authored a number of consumer guides on mortgages, home equity, refinancing and more.