1. Here are some questions you should ask your lender before getting a loan to purchase a home:

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3. What type of loan is best for me?

4. Different loans have different benefits and drawbacks, depending on your situation, goals, and preferences. You should ask your lender to explain the pros and cons of each option, such as fixed-rate vs. adjustable-rate, conventional vs. government-backed, and conforming vs. jumbo. 

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6. What is the interest rate and the annual percentage rate (APR)?

7. The interest rate is the percentage of the loan amount that you pay in interest each year. The APR is the total cost of borrowing, including the interest rate and any fees and charges. The APR is usually higher than the interest rate and reflects the true cost of the loan. You should compare the APRs of different lenders to find the best deal. 

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9. How much down payment do I need?

10. The down payment is the amount of money you pay upfront for the home. The more you pay, the lower your loan amount and monthly payment will be. However, you may not need to pay 20% down, as some loans allow for lower or even zero down payments. You should ask your lender about the minimum down payment requirement and any down payment assistance programs that you may qualify for. 

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12. What are the closing costs and fees?

13. Closing costs are the expenses that you pay at the end of the loan process, such as appraisal, title, escrow, and origination fees. They can vary widely depending on the lender, the loan type, and the location. You should ask your lender for an estimate of the closing costs and fees, and how they can be paid. Some lenders may offer to waive or reduce some fees, or roll them into the loan amount. 

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15. How long will it take to process and close the loan?

16. The time it takes to process and close the loan depends on several factors, such as the lender’s workload, the complexity of the loan, and the availability of the documents and appraisals. You should ask your lender for an expected timeline and what you can do to speed up the process. You should also ask about any potential delays or obstacles that may arise. 

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18. What are the loan terms and conditions?

19. The loan terms and conditions are the details of the loan agreement, such as the loan amount, term, interest rate, payment schedule, penalties, and prepayment options. You should ask your lender to provide you with a clear and complete explanation of the loan terms and conditions, and any fine print or clauses that you should be aware of. You should also ask for a copy of the loan documents before signing them. 

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21. How much income and assets do I need to qualify for the loan?

22. The income and assets are the sources of money that you have or can access to pay for the loan. The lender will verify your income and assets by asking for documents such as pay stubs, bank statements, tax returns, and investment accounts. You should ask your lender what the minimum income and asset requirements are for the loan, and what documents you need to provide. 

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24. What is my credit score and how does it affect the loan?

25. The credit score is a numerical representation of your credit history and behavior, based on the information in your credit reports. The higher your credit score, the more likely you are to get approved for the loan and get a lower interest rate. The lender will check your credit score and report by pulling your credit from one or more of the major credit bureaus. You should ask your lender what credit score you need to qualify for the loan, and how your credit score affects the loan terms and conditions. 

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27. Do I need to get mortgage insurance?

28. Mortgage insurance is a type of insurance that protects the lender in case you default on the loan. It is usually required if your down payment is less than 20% of the home value. There are different types of mortgage insurance, such as private mortgage insurance (PMI) for conventional loans, and mortgage insurance premium (MIP) for FHA loans. You should ask your lender if you need to get mortgage insurance, how much it will cost, and how long you will have to pay it. 

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30. Can I lock in the interest rate and for how long?

31. The interest rate can change daily or even hourly, depending on the market conditions. If you lock in the interest rate, you secure the rate that you are quoted at the time of application, regardless of any fluctuations in the market. However, locking in the rate may come with a fee or a higher rate than the current market rate. You should ask your lender if you can lock in the interest rate, what the fee or rate difference is, and how long the lock period lasts. 

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