1. Stay away from points
Paying points get you a lower interest rate. But in today’s Jacksonville housing market, interest rates are already low, and you will probably not stay in the house long enough to make up the difference.
2. Get at least 2 quotes (3 is better) from different mortgage brokers or banks
When mortgage brokers know you are “shopping” the loan, you will get their best deal. And always ask for a Good Faith Estimate (GFE) from each one. The GFE will describe the interest rate and terms, plus all the fees that will be charged, giving you a good way to compare loans.
3. Ask your Realtor for information on the Florida Bond Program
This is a wonderful way for buyers to get a low cost, low down payment loan, plus you do not have to pay doc stamps or intangible tax at closing. The Florida Bond program is for first time homebuyers or any person who has not owned a primary residence in the last three years with the exception of the Military Hero’s program. The Military Hero’s program is exempt from the first time homebuyer restriction. There is an option for up to $7500.00 in down payment assistance in the form of an interest free, payment free 2nd mortgage if you meet the income requirements.
4. Beware of Junk Fees
Most everyone has heard about junk fees charged by the lender. Did you know that real estate companies have been adding fees, too? Ask your Realtor if his company charges a Transaction Fee or Document Storage Fee — usually $175 to $500 — when you buy a property. It’s just another junk fee.
5. Beware of the “deal” offered by new homebuilders
New homebuilders often offer to pay your closing costs if you use their preferred lender. However, they may be adding their own closing costs to yours and the interest rate could be higher than what you would find on the open market. Always check with other lenders before making a commitment.