Shopping overview

Shopping overview

You cannot effectively shop for a mortgage by asking lenders
“What’s your rate today?”

HOW TO SHOP FOR A MORTGAGE

To effectively shop for a mortgage, you need to compare accurate, reliable quotes. Getting those quotes begins with determining the type of loan you want and gathering the precise information that a lender needs to price a mortgage tailored to your situation. You then need to find credible lenders, ask for the quotes clearly and unambiguously, and know how to compare the specific terms on the quotes you receive. I will walk you through each of these steps, and show you how to use the Shopping Toolkit to get the results you want.

 

1. Choose a loan type and terms

Although you may already know that you want a 30-year fixed, or a 7/1 ARM, review Loan options to help make sure the type of loan and all of the loan terms—prepayment penalty, interest only, points, etc.—are the right ones for you. I recommend talking to an experienced mortgage broker or lending officer to determine and explore your options.

2. Know your situation

Make sure that you understand your particular situation from the lender’s point of view. Know your credit score, and how a lender will view both your income and your assets. Check Information needed for a quote and use the Borrower Information worksheet in the Shopping Toolkit to walk you through and aggregate your information.

3. Ask the right people

It’s good to contact a range of lenders to get diverse offers to compare—ideally, at least one bank and one mortgage broker. Finding a lender will provide you with useful guidelines for deciding whom to call.

4. Get a reliable quote

Once you have gathered your information and know who to ask, learn the unambiguous language necessary to obtain quotes that are comparable in Get a reliable purchase quote and Get a reliable refinance quote.

5. Compare Loan Offers

Aggregate the quotes you receive from different lenders on the Loan Comparison worksheet in the Shopping Toolkit, and Comparing loan offers will walk you through evaluating those quotes.

 
If this kind of hands-on, self-directed approach isn’t for you, there is a simpler path. Read Finding a lender and choose an experienced professional early in the process to be your advisor –  a loan officer at a bank or credit union, a mortgage broker, or an online lender. You can end up with a mortgage package as good as that of someone who spends a great deal of time shopping many different lenders.

If you have questions, contact me and I can walk you through any step in the process.