Mortgage Finances

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Unless you are one of the few people who can afford to pay cash for a home in California, your next house hunt will also include a mortgage hunt. Getting a mortgage requires research and some preparation on the part of borrowers if they hope to get the friendliest terms possible.

Homes are substantial decades-long investments, so it’s smart to shop around to find the best rates and lenders available. These tips can make the process of applying and getting a mortgage go smoothly and may even help borrowers save some money.

Learn your credit score. Your credit score will be a factor in determining just how much bargaining power you have for lower interest rates on mortgage loans according to the financial resource NerdWallet. The higher the credit score, the better. Well before shopping for a mortgage, manage your debt, paying it off if possible, and fix any black marks or mistakes on your credit report.

Investigate various lenders. The Federal Trade Commission says to get information from various sources, whether they are commercial banks, mortgage companies, credit unions or thrift institutions. Each is likely to quote different rates and prices, and the amount they’re willing to lend may vary as well. Investigating various lenders can help you rest easy knowing you got the best rate for you. Lenders may charge additional fees that can drive up the overall costs associated with getting a mortgage. Compare these fees as well so you can be sure you get the best deal.

Consider a mortgage broker. Mortgage brokers will serve as the middle person in the transaction. A broker’s access to several different lenders can translate into a greater array of loan products and terms from which to choose. You can also choose a mortgage direct from a mortgage servicer. Jason Peterson is the office manager for Guild Mortgage in Brentwood, a direct mortgage lender. He and his associates help people into loans and continue to service the loans after they have been secured. He suggested using someone in the area who can answer questions specific to local real estate needs.

“Find someone who is local, who has testimonials and customers who can vouch for their knowledge,” Peterson suggested. “You need someone who can negotiate the (mortgage) process for you, or it can be frustrating and costly.”

Learn about rates. Become informed of the rate trends in your area. Lower rates translate into significant savings per month and over the life of the loan. Rates may be fixed, though some are adjustable-rate mortgages (also called a variable or floating rate). Each has its advantages and disadvantages, and a financial consultant can discuss what might be in your best interest.

Discuss points with your financial advisor and lender. Some lenders allow you to pay points in advance, which will lower the interest rate. Get points quoted in dollar amounts so they’ll be easier to compare. If you’re unfamiliar with points, discuss the concept with your financial advisor.

The vast majority of homeowners secured a mortgage to purchase their homes. Learning about the mortgage process can help new buyers navigate these sometimes tricky financial waters.

Guild Mortgage is located at 651 First St., in Brentwood. For more information, call 925-278-6677 or visit