| By :
Patricia Strasser
Ask the following questions to lenders: Which loan is the best for me? What are the different fees? What is the interest rate? Do you offer loan rate locks? Are there any prepayment penalties? When getting a loan, always know the important details, especially those pertaining to policies and fees. Be practical and get to know your options before going ahead and settling on any loan. Before taking advantage of the services of a lender, ask the following questions: Which loan is the best for me? Reliable lenders always scan their potential customers before offering a loan. This enables them to get an assessment of you before they can recommend their services. It is best to choose a lender that carefully and completely gathers necessary information from you before suggesting which type of loan you need. For your part, don't hesitate to ask from more information about important details such as fixed-rate loans, interest-only loans, and adjustable-rate so you can begin to identify which loan will be the best for you. What are the different fees? Always know the details of each fee you might encounter. It's good to note that all the charges of a loan do not only include fees that are solely for the lender, but also for third-party vendor charges as well. These include: the lender's title policy, the appraisal, your credit report, recording fees, and taxes. What is the interest rate? Another feature you should ask about is the interest rates and annual percentage rates. The annual percentage rate is obtained from different calculations which involve interest rates and all other charges. It's also good to note that most lenders do not compute APR correctly. When the interest rates are adjustable, it is important that you know about the margin, index, and adjustment frequency as they pertain to your loan. Do they offer loan rate locks? You should know that the interest rates change on a regular basis. If you are concerned about interest rates moving up before you make your final decision, then you might want to look into a loan rate lock. The lenders sometimes charge 0 to 1 point to lock you into loan rate. Ask for details about the following: charges for the loan lock, how long the lock lasts, if it protect all the loan costs, and can you get you loan lock in writing? Are there any prepayment penalties? Some states no longer allow prepayment penalties, so ask what the policy is for paying your loan off early. Prepayment penalties allow the lender to gather an additional 6 months of unearned interest if you pay the loan early. Be sure to ask how much the prepayment penalty is and what the means are to prepay. No matter what, choose the lender you are most comfortable with. That way, you can minimize your worries and assure that things will go smoothly when using their services.
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