Doing your research is a big part of the process when considering for a loan and speaking to a mortgage lender. Not all lenders are the same and provide you with the same process so it is important to understand as much as you can before you move into the process of acquiring a mortgage. When you are refinancing or purchasing a home, there are several questions that come to mind and that you might find important to consider before taking the next steps.
Here are some questions which have been compiled which you can ask your mortgage lender specifically.
1. How does a mortgage loan work? What are the different types of mortgage loans?
Many times, people are first time home buyers when they are entering this process. You may also have to refinance your home to be placed in a more favorable situation as well as you may need to convert some of your current existing assets and home assets into cash.
When starting a mortgage process, you have to have documentation to upload and sign. The promissory note is the process of payment which details your monthly payment and term length of when to pay back the loan.
There are many kinds of mortgage loans out of the three. There are fixed rate loans and adjustable rate loans which change over time. There are also varying time lengths of loans, the longer the loan term generally the cheaper your monthly payments would be. The interest you pay is generally greater on shorter term loans.
Mortgages, annuity mortgage, endowment, current account, pension, mortgages are some of the types of mortgages offered in Ireland. Looking into these could be a good way to gauge what type of financial product you are actually interested in, making the process more efficient and clear as to what you are engaging in.
2. How Do I qualify for one?
When it comes to qualifying for a mortgage loan, lenders look over factors such as income, property, assets and credit. Your credit report and score will be looked over by lenders to assess the lowest median score of all borrowers on the loan to see if you are qualified. Income is also important as it is valued against your debts to see if you are qualified for most loan options. This debt-to-income ratio is crucial as your lender will be able to know if you will be able to pay off your loan and house payment
Assets and property will also be looked at via the lender to assure that you have rough money for a down payment and that the property is of assigned value and ready to move in.
3. Which type of mortgage loan is best for me?
Having this conversation with your lender makes sure that you are getting that extra detail which you haven’t been able to collect on your own in the pre process. They might recommend a specific loan to you and some options in which you will be able to be educated and understand the differences, strengths and weaknesses of each. It is a good place to be aware of the alternatives and the different routes you can take to finance or refinance your home.