How to Find the Best California Mortgage
Compared to other homeowners, Californians pay one of the
highest premiums in the country for their warm, sunny climate.
According to the National Association of Realtors, the median
price for a single-family home in California topped out at an
eye-popping $542,000 in fourth-quarter 2005. While finding the
best possible mortgage loan rate is important wherever you live,
prices like these underscore the importance of doing your
mortgage homework if you live in California.
According to "Looking for the Best Mortgage", an article
published by the Federal Reserve, getting a good rate on your
California mortgage is basically a three-step process. The Fed's
strategy, which it calls "Shop, Compare and Negotiate", says a
mortgage is essentially a product like a car. Just like the
price of a new Caddy, the price and terms for a home loan are
often negotiable. So, says the Fed, it pays to shop, compare and
negotiate.
The first step in the process -- shopping for the best home
purchase loan, home equity loan or refinance loan -- is easier
than ever. That's because of the dramatic increase in the number
and popularity of online lenders. Nationally recognized lenders
like Home 123 or Ameriquest now offer a wide variety of mortgage
products in many states, including California. Besides offering
mortgage products that combine convenience and flexibility,
online lenders are also available 24/7 to give you a free
mortgage quote -- something that can't be said of traditional
brick-and-mortar lenders like banks or credit unions.
Shopping around for your California mortgage is just the first
step. After that, you'll want to compare the offers you've
received. Make a checklist that contains all the key information
about rates, points, fees, the down payment, and the cost of
private mortgage insurance. Set up the worksheet in a
spreadsheet program like Microsoft Excel and give each lender a
column of its own. That way it's easy to compare lenders -- and
the bottom line -- side-by-side.
Finally, says the Federal Reserve, don't assume a lender's offer
is the last word in your search for the best California
mortgage. That's because mortgage lenders frequently offer
different terms and rates to different customers, even if those
customers are equally qualified for a mortgage loan. It pays to
negotiate, so now is the time to show a prospective lender that
you're a savvy consumer shopping for the best possible deal.
Don't be afraid to ask for lower fees, a lower rate or fewer
points!
In conclusion, when buying a home or negotiating a home equity
loan or refinance loan, don't forget to shop around, compare
offers and flex your negotiating muscles. That way you'll get
the best possible deal on your California mortgage!