Getting The Right Loan

 

Getting the best mortgage loan for your personal situation is often very possible, but it does depend on many factors and is never as easy as the spammers on the web, deceptive telemarketers or talking heads on TV and radio claim it to be.

 

The first step in getting the right loan is meeting with a mortgage consultant that is experienced, knowledgeable and trustworthy.  This person will help you to answer the following questions:

 

1)     What is your primary goal in seeking real estate financing?

2)     How long do you plan to keep the property that you are financing?

3)     What is your income today and what is it anticipated to be over the next five years or the time you expect to keep this loan?

4)     What is the amount of your liquid and retirement assets in cash, stocks, bonds, annuities, cd’s, checking and life insurance?  Assets may help to determine what loan programs are available to you.

5)     If you own other properties, what is the amount of real equity in each property and what is the actual cash flow or negative cash flow from each of those properties?  This information may also help to determine what programs are available to you

6)     What is your credit score?  If you have low credit scores, what is the reason for this?  We have many ways to bring credit scores up to more acceptable levels. The time to repair credit depends on the individual situation.

7)     What other real estate goals do you have in mind for the next five and the next ten years? 

8)     Are you planning to pay for college expenses, elder care or other large expenditures in the next five to ten years?  If so, when?

9)     Are you planning any major purchases of large items such as boats, planes or motor homes in the next five years?  If so, what and when?

10) Are you planning retirement or any type of sabbatical in the next five to ten years?  If so, when?

11) Are you expecting an inheritance in the next five to ten years?  If so, how much?

12) Do you have any specific equity building, equity management or monthly payment objectives? 

 

The right mortgage loan for an individual situation will fall into alignment with the answers to the above questions. Market conditions are also a big factor in determining what the best loan may be for a given situation.  For instance, when rates are at their lowest, long term fixed rates are more attractive for many borrowers.  ARMs (adjustable rate mortgages) that are fixed at even lower rates for the first five years may be the best choice for someone who is planning to sell within that time.  When long term fixed rate mortgages and ARMs are equal in rate, long term fixed is often the best choice.  When rates are at the high end of the interest rate cycle, a three to five year ARM may be the best way to achieve current goals while waiting to get into a long term fixed rate program until interest rates cycle down.

 

A trustworthy mortgage consultant will help to determine which loan programs are the most prudent choice due to current market conditions and which are within reach due to your credit, income, cash flow and assets.  He or she will then help you to evaluate how each potential option interfaces with your long and short term goals as well as any equity or payment objectives you may have.  Then and only then, you will be on your way to selecting the right loan.  You can get the process started right now by sending an email to jchubb@pacificinland.com or to any of Pacific Inland’s team of professional mortgage consultants with the answers to the above questions.