Embarking on the journey to homeownership? Selecting the right mortgage lender is one of the most important decisions in the homebuying process. The Ohio Housing Finance Agency (OHFA) works with more than 140 mortgage lenders (listed on the website) to provide homebuyers discounted mortgage rates and down payment assistance. Mortgage lenders play a crucial role in helping a homebuyer understand the key financial indicators that comprise the mortgage preapproval process, including:
- Credit score;
- Debt-to-income ratios;
- Income and assets;
- Ideal monthly mortgage payment you can comfortably afford; and
- Which mortgage type you might qualify for.
When looking for a mortgage lender, it's important to ask:
- What loan types does it offer? Loan types, such as Conventional, FHA (Federal Housing Administration), VA (Veterans Affairs), and USDA (United States Department of Agriculture), offer varying features that offer advantages and disadvantages based on a borrower's specific credit background.
- Are there prepayment penalties on any of the loan types?
- Which down payment assistance programs does it offer?
- Will the mortgage loan be sold to a different mortgage servicer or retained with it? (A mortgage servicer is the company to which you make your mortgage payments.)
- Will real-time updates be provided via text message or email each time a milestone is reached in the mortgage process?
- How long does it take to close on a home from preapproval to loan closing?
- Can it provide references from previous clients that have used its mortgage company?
It's also important to make sure you have a clear understanding of the current mortgage interest rate and the annual percentage rate (APR) it offers and if it can provide you with a breakdown of all the fees associated with the mortgage loans, such as origination, appraisal, and closing costs.
You can search for mortgage lenders via OHFA's website or through mortgage associations like the Ohio Mortgage Bankers Association and Ohio Bankers League. Recommendations can also be sought through your real estate agent. It's important to have a team, real estate agent and mortgage lender, you trust to guide you through the homebuying process.
