Home Purchase Mortgage Calculators
Mortgage Program Calculators
We recommend that you contact at least four lenders when you shop for your mortgage. Creating competition for your mortgage business will allow you to obtain the best terms for your loan which can save you thousands of dollars at closing and over the life of your loan. Knowing the questions you should ask mortgage lenders is an important part of the lender selection process. You want to gather the right information so that you can accurately and effectively compare proposals. Below, we review the questions to ask so that you can make the most informed decision when you select a mortgage lender.
Below we provide a series of mortgage lender questions and answers to guide your discussions. We advise borrowers to ask these questions as part of the lender evaluation and selection process. Lenders who are willing to engage with you to answer these questions are more likely to possess deeper mortgage expertise and offer you a higher level of customer service. Lenders who are unwilling to address these questions or who do not provide compelling answers are probably less experienced and less likely to provide a positive mortgage experience for borrowers.
In short, an experienced and qualified lender welcomes questions from potential borrowers whereas a less qualified lender may react less positively so the questions function as an informative test. Understanding the questions you should ask mortgage lenders makes the selection process more productive and enables you to find the mortgage that is right for you.
This question allows you to determine if you are working with a mortgage broker or a direct funding lender. If the answer is yes, you are working with a direct lender . If the answer is no, you are working with a mortgage broker. There are positives and negatives to each type of lender and it is important to understand from the start what type of lender you are speaking with. Direct lenders may offer better mortgage terms because they are funding your loan directly but mortgage brokers offer borrower the benefit of shopping a network of lenders and they may have a wider range of loan programs to offer. We recommend that borrowers contact at least one mortgage broker and one direct lender when you shop for a mortgage.
If the lender intends to sell your mortgage after closing, then potentially you may have to make your payment to, and deal with, another party going forward. While this does not change the terms of your mortgage it can cause complexity in the future. This should not be the deciding factor when you select a lender but it is something to consider. It is important to highlight that even if a lender sells your loan, they may still service it, which means you continuing making your payments to that lender. Some borrowers may prefer that their mortgage is not sold or serviced by a different company so this is a helpful question to ask.
You need to make sure that you can lock your mortgage rate at any time during the process. Locking your loan protects you against an increase in interest rate and fees over the course of the mortgage process. You should also ask lenders if it costs extra money to lock your mortgage rate. Some times lenders charge extra fees or a higher mortgage rate when you lock your loan and borrowers should try to avoid these additional costs.
When you contact lenders, it is also important that you request you request a Loan Estimate and Lender Fees Worksheet. These documents outline the key terms of the lender's proposal including mortgage rate and closing costs. Use the information from these documents to compare proposals, negotiate better terms and save money on your mortgage. Please note that some lenders may request that you to submit a loan application to receive an Loan Estimate and Lender Fees Worksheet. Lenders, however, cannot charge you to submit a loan application or to provide these documents. Plus, most lenders will provide a Loan Estimate and Lender Fees Worksheet even if you do not submit a loan application.
Getting pre-approved for your mortgage provide greater certainty that your loan will close, enables you to identify and resolve issues before you apply for the loan and potentially accelerates the mortgage process. Getting pre-approved also makes you more attractive to property sellers. Plus, it is free and there is no obligation for borrowers. You want to make sure that you select a lender who is willing to pre-approve you for your mortgage.
Use our get pre-approved form to get approved and review no obligation mortgage proposals from leading lenders in your area. The form is free, easy-to-use and requires minimal personal information.
There are many different types of mortgage programs for different borrowers and property types. Each program has unique eligibility guidelines and qualification requirements so you want to make sure that your lender has experience with program you want. For example, there multiple no or low down payment programs that may require slightly different applicant information. Or the qualification requirements for a mortgage on an investment property are different than the requirements for a loan on an owner occupied property. Working with a lender who possesses expertise with a specific loan program can make the mortgage process go much smoother.
You should also confirm that the lender offers the mortgage program you need as many lenders offer a limited selection of programs. For example, if you need a larger mortgage, make sure the lender offers jumbo loans. You do not want to waste your time selecting a lender that does not offer the loan program you want.
We recommend that you request multiple client references when you contact lenders. A lender's response to this question will tell you a lot. If a lender is willing to provide references they are more likely to provide a higher lever of customer service. If the lender is unwilling to provide client references it suggests that the they are either inexperienced or do not have many satisfied clients. You can learn from a lender's client references, even if you only contact one or two references.
Use the FREEandCLEAR Lender Directory to search over 3,900 to-rated lenders by type and mortgage program.
It is important to understand the upfront fees a lender charges to process your loan. These fees are typically required by the lender before you know if your mortgage has been approved and are usually non-refundable. Remember to compare multiple proposals to make sure you find the lender offering the lowest combination of mortgage rate and closing costs. Determining the upfront lender costs is an important part of the lender selection process.
This question only applies to mortgage brokers. If the answer is yes, then you know how the mortgage broker is being compensated. Mortgage brokers are usually paid by the funding, or wholesale, lender and not directly by the borrower. Knowing this information may allow you to negotiate better loan terms, including a lower mortgage rate. The mortgage broker may be willing to take a lower lender paid rebate to offer you improved mortgage terms.
Applicants must meet a lender's mortgage qualification requirements to qualify for the loan so it is very important that you understand these requirements before you select your lender. Qualification requirements usually focus on your credit score, debt-to-income ratio, loan-to-value (LTV) ratio, down payment and employment history. Make sure that you meet the borrower's qualification requirements in advance of applying for the mortgage so that you have no negative surprises.
In addition to understanding the qualification requirements, make sure you understand the personal and financial documents the lender requires to submit your loan application. You want to make sure you have your paperwork in order and can provide the documents necessary to process your mortgage.
If a lender is willing to compete for your mortgage business then they may be more open to negotiating key loan terms and offer you a better proposal. If a lender is unwilling to compete for your business then they have either offered you their best and final terms or do not want your business. For example, if a lender refuses to provide a mortgage quote or proposal, we recommend that you contact a different lender.
Shopping lenders and creating competition for your mortgage business enables you to find the best loan terms. Contact multiple lenders in the table below to shop for your mortgage. Comparing loan proposals enables you to find the mortgage and lender that are right for you.
Watch our Mortgage Lender Options video tutorial.
Mortgage Lender Options Instructional Video
Lender Questions: https://www.consumerfinance.gov/owning-a-home/explore/contact-multiple-lenders/