Alabama Home Loan Dos and Don'ts
DO
Try to get pre-qualified for a loan before you go shopping - The reason for this is to solidify your credibility with home sellers and their real estate agents. People who are trying to sell their home are not interested in wasting their time with interested buyers, only to find out after showing the home several times that the interested buyer can't get a loan to buy the house. Getting pre-qualified is simple and easy, and usually requires only the most cursory check into your employment and credit history.
DO
Read your loan paperwork carefully - or have it reviewed by a lawyer. This may seem like a hassle and unnecessary, especially if you are getting your loan through a national or well-respected bank, but there may be points of contention in your loan that you can negotiate better in your favor if you know they are there.
DO
Think very carefully before getting into an adjustable rate mortgage or interest only loan - as these loans may seem very enticing with low monthly payments at first, but you must be prepared for the generally inevitable climb in your interest rate and monthly payment.
DON'T
Limit yourself to shopping for the maximum home you've been approved for - Just because you get approved for $300,000, doesn't mean that you have to buy a $300,000 house. Leave yourself some cushion room or better yet, some breathing room in the amount of monthly payment you will have on a house. Look for homes that have an asking price around 10% lower than what you've been pre-approved for - you will probably talk the seller down from there as well, which should leave you with a comfortable total loan amount when all is said and done.
DON'T
Attempt to deceive your way into a loan - The application for a home mortgage in Alabama is long and detailed. Be as truthful as possible when filling out the application form because any stretching of the truth will probably be discovered by the lender's underwriting staff and need to be explained by you, causing a delay in processing.
If you do not understand any of these terms you can find help using the glossary of terms given. If you are not having any problems understanding these ideas, it probably wouldn't hurt to look through the terms to gain some knowledge either.