When it comes to a home loan, shop around to save money

Shop around to find the best deal on a home loan.

Shopping around for a home loan betters your chances of saving money on your mortgage. Different lenders offer different products, and it is up to you to find the home loan that is best for you.

There are several things to look at when comparing offers for home loans from different lenders. You are not just comparing interest rates. It is far more involved than that. Consider the following factors that can affect how much you pay on a home loan.

• Pre-approval. This is the best way to shop around for a home loan. Contact several lenders to get pre-approved. You provide your basic financial information -- income, assets, debt -- and the lender estimates how much of a loan they can provide to you. Because this is not a formal loan application, you can get pre-approved with several lenders and compare the home loan products they offer.

• Fees. Interest rates may not vary that much between lenders, but fees do. When shopping for a home loan, get a written estimate of all the fees you are expected to pay from every lender you are considering. Question any fees that you do not understand. Upon being questioned, some lenders may even waive the fees for you.

• Different products. Home loans come in many shapes and forms. You can get a fixed-rate mortgage for 15, 30, 40, or even 50 years, you can get an Adjustable Rate Mortgage (ARM), or you can get a hybrid ARM that is fixed for a set period and then has an interest rate that adjusts. Compare the different home loan products that lenders are able to offer.

• Your circumstances. Certain lenders specialize in specific customers. If you have bad credit or a small down payment, just any lender may not work for you. Instead, shop around and find a lender that specializes in your situation for home loans.

• Customer service. You may find a great rate with no fees, but if the lender cannot close the deal, you have not saved any money. Make sure whatever lender you choose for a home loan has a good reputation for follow-through and good customer service.

Whenever you make a big purchase, you probably do some comparison shopping to find the best deal. A home loan should be no different. Get several different offers and compare who has the best one for you.