Terms of the loan
To avoid getting something other than what you were told, you must have all the terms in writing. Read the documents and make sure it is what you were told verbally. Do not assume anything.
A friend recently refinanced the mortgage on his home. He asked his loan agent if it was a 3-year fixed. The agent said it was, and the rate will adjust after three years. Two months after the refinance, my friend received a payment statement that showed an increase in his payment. I reviewed his loan documents, and sure enough, it does say the interest rate is adjusted annually. Unfortunately, he did not ask me for advise before he closed the loan, and he did not read the paperwork carefully before he signed.
Most people do not read the inch-thick loan documents that you sign when you close escrow. I admit, most of it is boiler-plate verbage detailing fine points that will probably not affect you. But I always advise my clients to read the parts that are filled in. The parts left blank are filled with the terms that are particular to your loan.
I have seen mistakes in loan documents such that they have to be redrawn before my clients will sign them. Here are some important points to check to look for:
Make sure your name and property address are correct. Yes, I have seen wrong names on the right address on loan docs.
Is the loan amount correct?
Check the term of the loan - 15 years, 30 years, etc. Make sure the last payment date shown is calculated correctly. For example, if it is a 15-year loan, and you close in May, 2006, your last payment date should be May, 2021. I caught that mistake on my refinance.
Does the prepayment penalty apply? What are the terms of the penalty? Is that what you were told?
What is the interest rate shown? Is it what you were told?
Is there an Adjustable Rate Rider? If there is, that means your loan has an adjustable rate feature.
Are impounds included? Is that what you wanted?