Home Loan Shopping

Risks of Shopping Your Mortgage

Shopping for a Florida mortgage is more difficult than shopping for almost anything else. Home loan rates vary from Lender to lender and change throughout the day. The fees charged by mortgage brokers and lenders can vary substantially.

Small differences in the terms for two mortgages with the same rate can cost an unwary Florida borrower big dollars.

In the hopes of making the Florida mortgage maze a little easier to navigate, we have created a short guide to help you be a more effective mortgage shopper and get meaningful quotes from mortgage brokers and lenders alike.

• Shop for a Florida Mortgage with the knowledge that getting the right Florida mortgage involves more than comparing interest rates. Of course, the APR is an important consideration, but a smart mortgage shopper considers the full cost of the mortgage. What are the broker fees? What are the prepaids? Does it have a prepayment penalty? The terms and fees are just as important as the rate in comparing competing proposals when financing or considering a homeowner Refinance Loan option for your Florida home.

• Make sure that you are shopping for the right kind of home loan. As you shop for your Florida mortgage, you should have a good idea of how long you intend to stay in the home that you are purchasing. Better still, is not to shop for a Florida mortgage until you have narrowed you home loan options to a single loan program. Comparing APRs of different types of loans is meaningless. Make sure that you are comparing apples to apples. Make certain you only compare 5/1 ARM with a Libor Index with other 5/1 ARM products that are tied to the Libor Index. Don't shop until you know what kind of Florida mortgage you plan on getting.

• Shop with a borrowing scenario that is complete enough to help you compare mortgage brokers and lenders fairly. If you call and ask for a mortgage companies best rate on a 30-year mortgage, you aren't likely to get any meaningful information. As they say in the mortgage industry "Do you want the rate today, or the rate you'll actually get?" But if you are aware of your Credit and reserve situation and can provide full information, you stand a better chance of getting a useful Florida mortgage quote. For example, a Tampa borrower who asks this way gives the mortgage company enough to go on: "I have a 750 Credit Score. I'd like to borrow 200k on a 30 year fixed home loan. I have reserves of 50k after closing. I do not want to pay discount points. I need a loan without a prepayment penalty and with a 30 day rate lock." That scenario has given the mortgage loan officer a much clearer picture from which to give you a more accurate quote on your Florida mortgage.

• Shop for Florida mortgage quotes at the same time of day. Mortgage rates change throughout the day. The ones that you see published in the paper are so out of date as to be worthless except as a means to get people to call the mortgage firms who advertise them. If you want to compare what is available today, you really have to shop at the same time of day. It's best to call mortgage companies consecutively within an hour or two of one another when you are shopping for a Florida home loan.

• Do not allow multiple mortgage firms to run your credit when you are shopping for a Florida mortgage. Multiple credit checks can actually lower your FICO® scores and make qualifying for a home loan more difficult.

• Scrutinize the written good faith estimates that you get from the mortgage companies that you shop. All mortgage originators are required by law to provide you with a GFE within 72 hours of your completing an application for a Florida mortgage. Be sure that the numbers provided for taxes are based upon information from the tax assessor's office and that costs for homeowner's insurance is reasonable. A GFE can be made to appear artificially low by using numbers that are inaccurate. We operate on the premise of giving a GFE that is a true good faith estimate and reflects as closely as possible the costs to close your Florida home loan. Be wary if one of the mortgage quotes you get while you're shopping seems to be significantly better than the others. Wait to see the GFE.

• Shop for your Florida Mortgage Broker as hard as you shop for your Florida mortgage. It's best to shop less for program and terms and more for an experienced and reputable mortgage company who you are comfortable working with. Choosing the broker you work with is the most important choice that you make as a borrower. Choose well and you are well on your way to getting a home loan that will serve your long-term financial interests.

• Ask for recent references from the mortgage loan officer and call them to see what sort of customer service the mortgage company provided. We will be happy to provide you with references from Realtors® and past clients.

• Ask if the Florida mortgage loan officer will be attending your Real Estate closing. At Capital Lending Corp., our Loan Officers attend all closings within driving distance of our Lutz, Florida office.

If you have any Questions on our guide to shopping for a Florida mortgage or would like to start your shopping with a mortgage quote from us, call 1-866-924-4111 and ask for Capital Lending Corp. mortgage expert.