Mortgage Loans - Where to Find One

Finding the Right Mortgage Loan for Your Home

Buying your first house can be overwhelming. How much can you afford? What are the interest rates? What kind of loan should you choose? All of these questions are running through your mind when you want to finance a home. Realtor's tend to be optimistic and maybe a little pushy when they are trying to "make the sell." What steps should you take when purchasing your first home?

Begin by making sure your credit is in order. You can run a credit check on yourself to see if you have decent credit. Mortgage lenders look at your FICO score (which is your credit rating) to determine the rate of your loan and what types of programs you for which you can qualify. In order to get an accurate idea of your FICO score you need a report from all three credit agencies. To facilitate a report and get accurate credit scores the best place to go is www.fico.com. A report from all three agencies (Equifax, TransUnion and Experian) will cost about $40. Normally when a creditor is inquiring about your credit to determine if you qualify for financing, the inquiry will drop your credit score a little, but if you are running the report on yourself it will not affect your score. You need to keep this in mind while you are shopping around for the right mortgage company. Don't give them permission to do a credit check until you are fairly sure that they the company you want to use for your financing.

Once you find out your credit score then you can search for the best mortgage company. A good way to find a reputable company is "word of mouth." Part of your search should include finding a good loan officer who is knowledgeable and trustworthy. You want someone who will shop for the best possible rate and explain all of your options to you; including loan programs that are available.

After you find a reputable mortgage company, it is time to choose what type of loan will work best for your situation. There are several programs to choose from and most companies offer almost any kind of loan imaginable. Typically for "first-time homebuyers" a fixed rate conventional loan, an FHA (Federal Housing Authority) or a VA (Veteran's Administration) are the most popular.