Check out mortgage lenders before you buy
If today's low mortgage rates and bargain-basement home prices have you eager to start shopping for a new home, it's crucial to find a reliable mortgage lender who can help you find the best mortgage rates and help you understand the closing process.
When you begin your search for a mortgage lender, your best bet is to ask friends and family members for recommendations. Then check those recommendations out for yourself.
Mortgage loan originators must be registered or licensed, so a good starting point is the searchable database provided by the Nationwide Mortgage Licensing System, which contains many, but not all, licensed brokers.
Keep in mind that lenders who work for banks and credit unions need only to be registered and thus don't need a license.
Many a mortgage lender also earns certifications from educational groups and associations which require that they successfully complete continuing education programs.
It's also important for you to ask about a lender's experience and if he or she has expertise in the area that meets your needs, like refinancing or working with first-time home buyers.
They also should be conversant about the current market in your city and the changes that have occurred since the housing bubble burst.
Be sure to ask about mortgage rates, too. You can compare the lender's response to the best locally available mortgage rates, which you can find on Bankrate.com.
Careful with fees
It's important to be aware of the range of fees that must be paid at settlement. To be prepared, get good faith estimates, or GFEs, from a number of lenders and take the time to compare them.
The U.S. Department of Housing and Urban Development even provides an online work sheet that you can use to compare GFEs from various mortgage lenders. It is designed to help you determine which one is the best offer.