If you read and follow the advice below,  you can save hundreds of dollars on home loan.

It may sound funny, but the best way to get the lowest rates and fees is by not starting with that in mind.  Don’t start by shopping for the lowest rates, points, and fees. These are often presented by a lender or broker as low, “teaser rates and fees” that are easily increased as you move thru the process.  You will hear phrases such as “no out of pocket costs”, or “no fees”, or “no increase in loan balance”, or “no points”.   This is just to confuse you.  It means they are pushing the costs and fees into another place and then passing them on to you, thinking you wont figure it out.

It may not be obvious, but the underlying interest rates are very competetive. The lender makes money on the fees and costs when they process the new loan.  This is where you need to focus.

It’s important to, first, spend some time to find a small group of brokers or lenders you trust.  Then, and only then, begin comparing rates among these brokers and lenders. 

If a lender is good, they should be discussing the following with you, before you commit to using them.
- The goals of your loan.  (Each will have a significant impact on your loan).
- How long will you be in the home? 
- What is important to you, low monthly payments, loan paid off by a certain date eg(retirement)? 
- New home purchase, vs refinance, second home, investment property, etc.   
- Do you need early payoff?
- Explain your options for a loan and what the implications are.
-  Adjustable vs. fixed rates. 
- Interest only loans, 
-  Second loans.
-  Jumbo loans
-  Investment property loans.
- Your credit history.  This would include:
           –  Bankruptcies or foreclosures, 
           –  payment history on credit cards, and 
           –  Credit cards you use and open balances and credit limits.
           - All points, fees, and rates associated with the loan. 

They should show you several options, explain them well enough that you feel confident in making a decision on your own.  They should also explain: 
   - The total cost of the interest paid over the life of the loan. Most times, this will be more than the amount borrowed.
   –  If the loan is adjustable, how much can the loan adjust, and how often?

Now, it will be time to talk about “What are the costs and fees for the loan?”.  
           There are always costs and fees with a new loan  — the question is how and when and how are they paid.  
           The lender should explain this.  How does the lender and broker get paid?  
           How much will they make on the loan? If they won’t share this, be very careful.

How much money will you need out of pocket at closing?

If the broker/lender follows this process, you can be confident that they will get you a very competitive rate with excellent fees and points.