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Article:   The Biggest Mistake People Make When Shopping For A Mortgage

THE BIGGEST MISTAKE most people make when shopping for a mortgage loan is to ask only about the interest rate.  When you call a lender and find the lowest interest rate, you may be fooling yourself to think you've found the best deal.  An equally important question to ask is, "What are the closing costs associated with that rate?"  Ask the lender for a good faith estimate which will identify all closing costs for a given loan program. 

In addition, ask for a truth-in-lending (TIL) disclosure that will calculate the annual percentage rate (APR) for that loan.  The APR is the cost of a mortgage stated as a yearly rate and includes such items as interest and loan origination fees (points).  The APR is the true measure of comparison to determine which loan program offering is the best.

Article:   The Importance of Good Credit

THE IMPORTANCE OF GOOD CREDIT is probably the highest consideration given by an underwriter when evaluating a loan request.  A credit report from the credit bureau shows the types of credit you've had in the past and whether you've repaid promptly with other creditors.

Another important factor that is considered by the lender to approve your loan is your income and your assets.  Your current earnings along with other available funds help determine your ability to repay a loan.

The appraised value is yet another factor that is considered when reviewing a loan request.  An appraiser will provide an estimate of the market value of your home, based on similar homes recently sold in the neighborhood.  Lenders generally lend you up to a certain percentage of the appraised value. 

For conventional loans, if your loan to value (LTV) is greater than 80%, you will be required to purchase private mortgage insurance (PMI).  This insurance helps you become a homeowner faster by allowing you to finance a home with less than 20% down.

For most of us, a home is more than a simple shelter or a good investment.  A home of our own is a dream come true.  At Country Home Mortgage, we specialize in making dreams come true.  Contact one of our offices near you so we can help make your dream come true.