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What are some important questions to ask mortgage lenders?

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Quick Answer

It is important to ask mortgage lenders about their fees, points and qualification requirements for the deal offered and if these rates are negotiable, states U.S. News & World Report. Borrowers should also ask mortgage lenders for an estimated time frame for the loan approval and closing process, notes SchulerBauer.

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Full Answer

When choosing a mortgage lender, it is important to ask the mortgage lender if it has any specific area of expertise that is a good fit for the borrower, according to Forbes. For example, a mortgage lender with experience in Veteran Affairs loans is a good match for a borrower with those needs.

When discussing fees and rates, it is important to ask mortgage lenders for good-faith estimates and truth-in-lending statements and request these two statements electronically available in writing, according to Forbes. Additionally, borrowers should ask mortgage lenders about their lock-in period, and whether they can obtain a lower interest rate if the rate drops during this period, according to SchulerBauer. Borrowers should ask also if they need to buy private mortgage insurance, if the mortgage lender has any escrow requirements, and if there are any possible charges for prepaying the loan.

For borrowers with more unusual profiles, such as self-employed borrowers, it is important to ask the mortgage lender about the kind of documentation required and potential reasons for denial or delay of the loan, according to U.S. News & World Report. As an additional precaution, borrowers should also ask mortgage lenders whether they hold loans or flip loans.

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