Houston Mortgage First-Time Homebuyer – Frequently Asked Questions (FAQ) – Part 6

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Part 6: Finding the Right Mortgage Loan

After gaining an understanding of the basics of mortgage loans, it is time to learn more about the fine details associated with these loans. To help you gain a better understanding, here are the answers to some of the most Frequently Asked Questions (FAQs) about finding the right mortgage loan.

How can I choose the best mortgage loan program for me?

You will need to consider your personal situation when trying to determine which loan program is best for you. Some questions you should ask yourself in order to narrow down your options include:

  • Do you expect your financial situation to change within the next few years?
  • Do you plan to live in the home for the next several years?
  • Are you comfortable with your mortgage payment amount changing over time?
  • Do you want to have your mortgage debt paid off when it is time for your children to go to college or when you are ready to retire?

By having clear answers to these questions, you will be better prepared to further explore your options with your lender in order to select the program that is right for you.

How can I compare loan terms between lenders?

When comparing loan terms between lenders, you should create a checklist that contains all of the following information:

  • Type of mortgage
  • Minimum down payment required
  • Interest rate and points
  • Closing costs
  • Loan processing time
  • Whether or not prepayments are allowed

Be careful if you are contacting more than one lender on different days; interest rate quotes will vary because they can fluctuate on a daily basis. Ideally, choose a lender who is highly qualified and offering a great rate with a float down option. A float down option can give you the ability to lower your interest rate one time if rates go down after you lock in your rate.

Are there fees associated with the loan origination process?

Yes, there are costs associated with closing your mortgage loan, such as appraisal and processing fees. However, there is no cost to apply for a loan with our mortgage team. Our consultation is always free. Call us at (800) 308-8503 or (281) 305-9375 or visit our website at www.HoustonMortgageTexas.com.

Are there fees associated with the loan origination process?

Yes. The Real Estate Settlement Procedures Act, or RESPA, requires lenders to disclose information to potential customers throughout the entire mortgage process. Information lenders are mandated to share includes:

  • Business relationships between closing service providers and anyone else involved with the transaction
  • Closing costs
  • Escrow account practices
  • Lender servicing practices

To learn more about RESPA or to receive a local counseling referral, visit the RESPA webpage or call 1-800-569-4287.

You are also protected from discrimination based on race, color, nationality, religion, sex, familial status or disability. If you feel a lender has discriminated against you, contact HUD’s Office of Fair Housing at 1-800-669-9777. The hearing impaired may call 1-800-927-9275.

What is a good faith estimate?

A good faith estimate is the lender’s estimate of all of the fees that will need to be paid before closing, the closing costs associated with your purchase, and the escrow costs involved with the purchase of your home. What are my responsibilities during the lending process?

As the buyer, you have to take on many responsibilities to ensure you do not encounter financial troubles, become the victim of fraud or otherwise get into legal trouble. Some of these responsibilities include:

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