How to Find a Lender
Today, lenders can be found through a variety of sources. In addition to asking friends and family for recommendations, and through referrals from your REALTOR. Ricky Schoonover has built strong relationships and will be happy to suggest lenders my clients have used successfully, who have proven themselves competitive and capable even with problem properties or poor credit. It’s important that you choose the lender that is right for you.
Local lenders will prove to be valuable
I strongly encourage utilizing a local Denver area mortgage lender. Lenders who are familiar with the local market will really help you as the buyer with a smoother transaction. I would not use a lender that is primarily doing business through the internet. Purchase contracts are time sensitive. In my experience on-line lenders lack the responsiveness and could cause you to lose your deal.
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. This goes back to choosing a local lender.
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.
