Mortgages come in all shapes, sizes, needs and so do the folks who lend you the money. It is important you identify the type of mortgage and lender you require and why it is essential to use the correct mortgage and lender based on your circumstance.
Don’t let how you borrow and who you borrow from start your investment real estate portfolio down the wrong path.
4 Main Types of Mortgage Lenders
There are many different types of mortgage lenders in the financial world; who are they, how do they lend and what is their cost to borrow? Most of these mortgages lenders fit into four categories.
Spending time identifying your needs; helps you chose the right mortgage lender.
Below is a list of lenders and their roles to borrow are different.
Home Purchase Lender
Home Equity Lender
Investment Real Estate Lender
Home Purchase Lender:
Might you be tired of renting? Have you been thinking about buying your first home? Has your family grown since you bought your first home and you believe it is time to upsize? Buying your first home or moving on up attracts many different mortgage lenders and conventional banks have built their banks on residential mortgage specialization.
Don’t be the bank’s new employee training ground; find a person who knows the in and outs of mortgages and the implications of home mortgages or adding investment real estate to your wealth accumulation portfolio.
Home Equity Lender:
If you are carrying credit card debt and have equity in your home, it could make sense to consolidate your debt so you can have lower interest costs and pay off your debt sooner. Be careful not to turn your home into an ATM; if you find you are paying off credit debt and consumer debt over and over again; watch the classic film Groundhog Day and see if you can learn lessons to stop the madness.
Using home equity correctly you can reduce your monthly obligations and save thousands of dollars in the long run; see if you can find a home equity lender who lends you more than money; see if they will give you some lessons on how not to let this type of debt sneak up on your again.
You’ve been thinking about doing home renovations but don’t have the money to do so, or maybe you want a lower interest rate on your mortgage. You can look to refinance your current mortgage and or you look at various options that different lenders have so you can refinance your mortgage in a way that is right for you.
Investment Real Estate Lender:
Investment property financing can take several forms, and there are specific criteria that borrowers need to be able to meet. Choosing the wrong kind of loan can impact the success of your investment, so it’s vital to understand how the various alternatives work before approaching a lender.
At the end of the day; do you know what you want the money for and who is the best lender to help?