Apply for Mortgage

Assuming you've been pre-approved for a loan, you may want to continue working with your lender and apply for a mortgage. Here are some suggestions that might be of help:

  • Even if you have a pre-approval letter, it is always a good idea to shop around to compare mortgages. Rates differ, points differ and closing costs differ.
  • Always ask for a "good faith estimate" when shopping for a loan.
  • Are there pre-payment penalties?
  • Is there a way to avoid paying PMI (Private Mortgage Insurance), for example, using an 80-10-10 loan (80% loan, 10% 2nd trust, 10% down)?
  • If the loan is an Adjustable Rate Mortgage, exactly when will the rates change, based on what, and is there a cap of how high the loan may become?
  • What are the tax implications of this mortgage? Interest payments can be tax deductible, for example, a $2500/month mortgage payment may save you $700/month in taxes, leaving you with an overall monthly housing payment of $1800. Ask your mortgage broker or tax advisor for more information.
  • Be wary of internet mortgages. If it sounds too good to be probably is. Some internet deals may be fantastic, but if you're sitting at the settlement table at 10am and the loan numbers don't add up, and no one is answering the (800) number in CA, you may wish you chose a local mortgage broker.