Hello,
My wife and I are in the market for a house and are currently looking at specific houses. We've got a 10% down payment, enough for closing fees, over 800 credit scores and we're looking in the $500k-$600k range (which is mid-starter-level for our area near NYC).
I've read (4) books on mortgages and visited about 100 websites, and I've yet to find a consistent recommendation on how best to shop for mortgages or achieve a pre-approval. Some sources tell us to get a GFE and others say GFEs are worthless because they can change.
Some sources have advised us to use brokers because "brokers can shop around" and disclose their commissions, whereas other sources have suggested "why bother with a broker" when you've got good credit and can approach lenders directly.
Some sources say "focus on the APR," whereas others say, "focus on the whole loan package, not the APR."
Also, for all of the websites talking about the benefits of FHA loans, why wouldn't someone pursue an FHA? I can see how you'd pay more in the long run, but the mortgage maximums in our area are $625,500 for an FHA loan, and putting $15k down instead of $50k is pretty attractive. Just higher interest rates?
The book by Carolyn Warren suggests approaching a mortgage lender and two brokers, requesting GFEs and then a guarantee from the broker or lender that the final costs won't deviate more than 10%. Then go ahead with pre-approval. But I'm still wondering if we'd want to lock the rate in the current environment...
That seems to suggest that you're going through two rounds of mortgage shopping - once for the pre-approval, which may be meaningless if the rates aren't locked, and once again for the actual mortgage.
Any suggested steps (1,2,3), feedback, or thoughts are appreciated!
THANKS!
