4 Things to Ask the Loan Officer at Your First Meeting
The loan process will see you meeting a number of different people, every one of whom will have a distinct role. One such person will be the loan officer, who will work as the primary contacting point for your lender.
Here are some of the things that you should ask your loan officer when you meet them for the first time:
1) The types of available loans:
There are a wide range of loans available, each with its own down payment, interest rate, length, and repayment option. Even though you might not know the loan that you require just yet, it can never hurt to learn about the loan types that are on offer.
Take time to understand each of the loan types, be clear about the type that you require, and to ensure that that particular type is being offered by the lender.
2) The amount that you can borrow:
This is different from the amount that is affordable for you; this is the amount that the lender is actually willing to lend. This borrowable amount will depend on several factors, including your credit history and current income.
3) The down payment amount:
The upfront amount that you will have to pay will, again, depend upon personal factors like income and credit scores, but it will also depend upon the type of loan that you are going for. Mortgage’s, for instance, have traditionally had a down payment equal to 20% of the home’s purchase value. Today, however, you can find mortgages that demand as low as 3% (or even mortgages without any down payment).
It is important to remember that a lower down payment usually comes with a higher PMI (Private Mortgage Insurance) and interest rates – both of which can increase the monthly payments.
4) The interest rate:
You might be able to purchase points that will reduce your interest rate and end up saving you quite a bit of money over the years. With certain lenders, the initially quoted rates will include points. Make sure that you clarify whether points are part of the offer or if you can buy them separately.
Final Word:
Throughout the loan process, you will have plenty of questions. However, remembering to ask these four questions from the get-go will help you steer clear of a number of later pitfalls and obstacles.
