In 1934, Congress declared the creation of the Federal Housing Authority (FHA). During this time, only 40% of American homes were owned. Since this time, FHA made sure that the mortgages for around 34 million household are insured.
Some people think that FHA lends money for the mortgages, but that is far from the truth. It only ensures the lenders who provide loans for mortgages against any losses in case a borrower defaults. As of 2010, the FHA offers insurance for loans that have down payments for as low as 3.5%.
If you are looking for the Best Mortgage Lenders in Dallas TX, here is a guide just for you.
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Find Three or More Lenders
Don’t settle for just one. The preferred number of FHA-approved lenders for you to find is five. This way, you can choose which one is the best. You can check the FHA website for a list of agency-approved lenders in your area.
Interview your Lender
Once you find a lender, don’t choose quickly. Take the time to call them and have a mini interview. You can ask about how many of their loans are FHA loans in percentage. Know how long they have been doing the business and how long he or she has been working under mortgage businesses.
It is essential that you find an experienced lender since you are making a 15 to 30-year commitment. That’s a lot of years! It’s like getting married. Lastly, try to request for a good-faith-estimate (GFE) which will detail the quote for your home loan.
Compare Quotes
Using the “using the shopping cart” on your GFE’s third page, compare the quotes, as well as the settlement fees and annual interest rate for each of the loans. You have to know that each lender has a different FHA quote.
Some have higher settlement fees with lower interest rates while others have the complete opposite. Weigh in the interest rates and costs of the loan with different lenders and credit officers then choose the one you trust with the best terms.
If you have chosen a lender who does not have the best terms or interest rates, then why not try to negotiate? Who knows? You might get what you want. In case the loan officer does not negotiate, it is up to you to decide whether going on a commitment with the lender is worth all the extra cost. There are times it is.
Here are a few additional tips for you to decide who will be your lender.
Ask for Referrals
If you have a financial planner, insurance agent or other business professionals who you can trust, ask them for references. They can give you a name or two and check these referred lenders. Don’t forget to ask for at least three quotes. This ensures that you will be getting fair interest rates and pricing for your loan quotes.
A Word of Warning
FHA loans are pretty much popular nowadays, but if you can’t seem to find the right lender for you, you can consider other loan options.