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Choose the Right Mortgage Advisor and Save Thousands

By: Dean Weber If you are thinking of buying a home and are in the market for a home mortgage, you'd better start doing your homework right now. The reason is pretty simple - things have changed and the days of easy home mortgages are gone.

During the real estate boom of the last few years prices were rising like crazy and mortgage money was easy to come by. But as things started cooling off most banks and lending institutions began to tighten their lending practices.

Perhaps most important, interest rates have been rising slowly for a number of months. This may not seem like a big deal if you are new to the home buying market. But on a large home mortgage even a small interest rate increase can make a very big difference to your payment.

In fact it is usually the interest rate that determines how much you can borrow, so it is the interest rate that often makes the difference between being accepted or rejected for a home mortgage. The reason is simple. To qualify you for a home mortgage the lender determines what payment level you can afford. And since a big part of your payment will be interest, a higher interest rate could easily put the payment out of reach.

**Find a home mortgage advisor**

One of the first things you should do before making home mortgage decisions is to find a professional advisor who has a lot of experience in the home mortgage business. Look for an advisor who has in-depth and current knowledge of real estate and mortgage trends and can make use of many different sources of mortgage funds.

Often your best choice will not be your regular banker. Banks almost always recommend their own products and are not very interested in suggesting other products - even if they are a better deal for you.

Look at it this way - if you have a good credit rating and a good reliable income lots of lenders want your business. So chances are if you shop around you will find a better deal than the one your bank is offering. On the other hand, if your credit rating is spotty or you have cash flow problems you may need some creative suggestions. In this case your bank is not likely to be of much help either. They want you to do it their way and meet their requirements.

In other words, a bank is fine if you don't care about getting a better deal. However, if you want lower cost or more flexible alternatives or you need creative suggestions you're better to go somewhere other than your bank.

But where can you go? You should look for a home mortgage advisor who specializes in personalized service - someone who knows the market from the inside and who has access to many different sources of mortgage funds.

**Good deals are still available**

Even when credit starts tightening up there are ways to get a good deal on a home mortgage. Sometimes these good deals involve government backed loans such as FHA loans. These loans exist to help people with even horrible credit to borrow as much as 97 percent of the value of their home. The primary requirement is that they have the necessary income to make regular payments.

Home mortgages like these are very good deals for many people. They make home ownership possible for many people who might not otherwise qualify. But many traditional lenders either don't know about these options, or they won't recommend them because there is not enough profit in it for them.

In fact Even many mortgage brokers will not recommend these loans because they involve some extra work. However, from the borrower's point of view it is worth finding a mortgage broker who will put together the best deal for you. It could make an otherwise impossible mortgage a reality, and it could save you literally thousands of dollars over the life of your mortgage.

**An ARM can be a good short term solution**

There is also another type of loan available called the "option adustable rate loan", commonly referred to as an ARM. This kind of home mortgage allows a person with very good credit to pay as little as 1% interest against a "real" rate of about 7.25%.

But beware. The unpaid interest is added to the principal of your loan, so the amount owed actually goes up over time. That means an ARM loan must be used very cautiously because a home owner can end up owing more than they can afford to pay.

What this approach offers is the opportunity for a borrower to make drastically reduced payments for a short period of time. Its most common use is for people who have short term cash flow problems, or when a borrower sees his or her financial situation improving in a year or two.

**Make the right mortgage choices**

While it is more difficult than ever to get a very low rate on a home mortgage there are still money saving deals available if you know where to look. That's why it is crucial to deal with an experienced professional advisor you can trust. Look for someone who has intimate knowledge of the current home mortgage situation and who is experienced in dealing with your type of situation.

The best advisor is a broker who has hundreds of lenders to draw on, so almost everyone can get what they are looking for.

Article Source: http://www.lifeweightloss.com

Dean Weber has more than two decades experience as a home mortgage advisor, arranging commercial mortgages and all kinds of loans. Read these mortgage client testimonials to see how much actual home owners like Mortgages-Mall.com
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