Top 10 Tips When Applying for a Mortgage Loan

The Mortgage Bankers Association of St. Louis has just released
the top 10 tips to help St. Louisans protect themselves
when applying for a mortgage loan. As we move into a higher
interest rate environment, it becomes extremely important to
protect your interests when applying for a mortgage loan.

1 Get rate confirmation in writing: Be sure to sign a rate lock
agreement when you meet with your lender which will provide protection
if interest rates increase.

2 Don’t just consider the lowest rates: Consider the ENTIRE loan
package (rate, terms and closing costs). By law you must be provided
a “Good Faith Estimate” of closing costs.

3 Review the closing cost estimate: Don’t hesitate to contact another
lender to compare costs.

4 Check the lenders reputation and financial background: Call
the Better Business Bureau for assistance.

5 Ask about direct service: Ask the loan officer if their loans are
serviced locally or if the loan is being serviced by another lender
and outside source.

6 Ask about ALL mortgage options available: Do not allow yourself
to be “forced” into a specific loan program unless you understand
all the options.

7 Check and understand the loan features: Don’t take a loan with
features such as negative amortization or a prepayment penalty unless
you fully understand those features.

8 A photo I.D. will be required for loan: Banks now have to comply
with federal law under the Patriot Act to “know their customer”.
(Copies of your I.D. will also be required by the closing agent to
close your mortgage loan.)

9 Investigate all lending options: This may include little to no
down payment loans to interest-only initial terms for qualified borrows.

10 Check to see if lender is a member of the Mortgage Bankers
Association of St. Louis: Members have been providing quality financing
to the St. Louis area for 75 years and adhere to a strict code
of ethics. A roster can be found at www.mbastl.com.

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