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How to Find a Lender: Today,
lenders can be found through a variety
of sources. In addition to calling
on ads in the newspaper, you can also
find and apply to lenders over the
internet, and through referrals from
your REALTOR®. We would be happy
to suggest lenders we have used successfully,
who have proven themselves competitive
and capable even with problem properties
or poor credit.
Choosing the Right Lender:
Interview several lenders to evaluate
the following:
- Ability to explain things clearly
and return your phone calls in a
reasonable time period
- Competitiveness of interest rates,
costs & fees.
- Availability of loan programs
that suit your credit profile and
desired property
- Access to local loan approval
committee that understands the kind
of property you are buying
Choosing the Right Kind of
Loan: Today there are so
many types of loans on the market
that it is beyond the scope of this
page to list or explain them all.
Your lender is the best person to
help you select a loan program to
suit your needs. Below is a summary
of the three most popular loan types
we see in practice; for more detailed
information click the link at the
end of this page.
- Fixed loan: The fixed
rate loan assures your monthly payments
will stay the same over the life
of the loan, which is typically
between 15 and 30 years. Fixed rate
loans may be best if you intend
to hold the property for a long
period of time, say over 7 years.
- ARMs (adjustable rate mortgages):
ARM’s may be suitable if you
plan to sell or refinance your home
within the next few years. The starting
interest rate is typically lower
than a fixed rate loan, saving you
money initially. However, it is
important to understand the index,
the readjustment interval, the capitalization
rate and downside risks of an ARM
before making a final decision to
use this type of loan.
- Intermediate ARMs: Also
called Hybrid Loans, these
loans can offer fixed interest rates
for the first 3, 5, 7 or 10 years
after which the interest rate adjusts
with the market every 6 months or
year thereafter.
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