As with a lot of questions, the answer is "it depends." It depends on the kind of mortgage, your time frame, but most of all on your own circumstances. How much do you know about mortgages? How much time do you have? How price-sensitive are you? What is your risk tolerance? There are a lot of best ways; here are a few.
1. Shop Early Shopping for a mortgage should be your first step toward buying a house.Sellers will usually require that you be pre-qualified and preferably be pre-approved for a mortgage before they will entertain an offer and most real estate agents insist their customers get approvals early in the process. For your own peace of mind you should learn up-front if you can qualify for a mortgage under the new, tougher guidelines and at what cost.
Whether you are buying or refinancing, take the time to educate yourself; learn a little about what makes interest rates go up and down, the advantages and disadvantages of fixed-adjustable-, and hybrid-rate mortgages, the fees that might be involved, loan limits, and what is expected of you as a borrower. Even if you have obtained a mortgage in the past there have been a lot of recent changes to the process and requirements so some retraining can't hurt.
The earlier you start thinking about a mortgage the more time you will have to address any problems that might impact your ability to get a loan or what it will cost. There are no quick fixes for credit problems, excessive debt, or insufficient down payments, but the more time you allow the more problems you will be able to correct.
2. Shop Wisely All of the consumer smarts you employ when buying a car or computer are just as important when purchasing financial products like a mortgage. Know your rights as a borrower and what information and disclosures your lender is required by law to provide. If you aren't familiar with your lender ask for references and check with the state licensing authority (you can usually do this on line) for complaints or disciplinary actions.
Keep abreast of mortgage rates. They can change fractionally several times a day so don't make yourself crazy but in normal times the net change is seldom more than a few basis points (a basis point is.01 percent) a week. Still, if you aren't paying attention, rates can get away from you and which might mean an unpleasant surprise when you finally locate a house.
3. Shop 'til you Drop Obtaining a pre-qualification or pre-approval from a lender does not imply a commitment on your part. The mortgage market is very competitive and there may be better deals on rates and fees still out there. Although there are not nearly as many different mortgage products as there were a few years ago, private lenders are coming back into the market and so are new programs that might better fit your needs. Until you have to plunk down money for an appraisal or are ready to lock in a rate keep your options open.
And the best tip of all? Alan Bachman, CEO of Amerifund Home Mortgage in New York City suggests that a direct mortgage lender who is also a mortgage broker will most likely provide the most competitive terms and direct you to a loan that will be tailor made for your needs.
Alan Bachman, CEO
Amerifund Home Mortgage
New York, NY 10017
Phone: 212-922-9555 ext.2565
http://www.amerifundhomemortgage.com
An easy way to track rates is with Amerifund Home Mortgage Corporation's Automatic Mortgage Rate Alerts. To subscribe text, "homerate" to 32020.