Questions to ask a mortgage lender when looking for a home loan.

What is a pre-approval letter?
The preapproval letter is drafted by a loan originator to be used by a buyer’s real estate agent when presenting an offer on a property. The pre-approval letter is intended to assure the seller and the listing agent that the buyer has been approved by the lender and there should ideally not be any financing issues with the buyer.
What are closing costs?
Mortgages come with a list of fees because a mortgage is a legal document. The fees can be put into your mortgage sometimes. Ask for a list of estimated closing costs before applying for the loan.
What documents do I have to provide?
You will need to provide tax returns, bank statements, pay stubs, and investment statements. Different lenders may require more or less of these documents.
What are the qualifying guidelines for the particular loan?The qualifying guidelines can relate to your income, employment, assets and liabilities, and credit history. Remember some first-time home buyer programs and government-sponsored loans have easier qualifying guidelines.
What is the minimum down payment?
Depending on the amount of the down payment, you can get different interest rates, loan terms, and avoid private mortgage insurance. Some loans require the standard 20 percent down payment; others are special low down payment programs.
What is the annual percentage rate of the mortgage interest?
To effectively compare different lenders’ programs, ask for the annual percentage rate, or APR, of the mortgage interest, which is generally higher than the initial quoted rate because it includes all lenders’ fees.
What are points or origination fees on a loan, if any?
Points are prepaid mortgage interest, and you may have to pay points at closing in order to get a lower interest rate on your mortgage loan.
Can I lock in the interest rate?
The interest rate of the mortgage you’re applying for may go up or down before you close on the home. It may be wise to lock in the rate for a specified period of time, rather than let the rate float until the closing. Be sure to ask the lender if there is any fee for locking in the rate.
How long will it take to process my mortgage loan application?
The actual time depends on how quickly the lender can get an appraisal of the property, a credit report and verification of employment and bank accounts. Thirty days is considered the norm.
Is there a prepayment penalty on the loan?
In the State of Wisconsin there is not a pre-payment penalty on any home loan.
What can delay the approval of my loan?
There could be a delay if the lender discovers credit problems. More documentation may be required to work through the situation.