It pays to shop around for a lender. In addition to comparing interest rates, you'll want to consider total costs.

Closing costs are all the expenses associated with borrowing money from a lender, and they can be substantial!

Points are a one-time payment that guarantees the lending institution a profit and protects it against rising interest rates. You generally pay from one to four points, with each point equaling 1% of your mortgage.

Loan establishment costs include loan application and origination fees, attorney's fees, mortgage insurance premiums, transfer tax and prepaid interest.

Document preparation costs include a title search, home inspection (e.g., for termites and structural damage), survey and deed recording.

Title insurance protects a homeowner and/or lender from past defects in title from unknown risks such as mistakes in recording, liens for unpaid taxes and forgery. Lenders generally require title insurance as a condition of obtaining a mortgage. An owner's policy protects the buyer's interest. Costs for title insurance policies vary by state and by the purchase price of the property. Generally, you pay the one-time premium at the time of closing.

Compare the rates and costs for 15- or 30-year loans at fixed or variable interest rates before deciding on a lender. Places to check rates include banks, credit unions and online brokers. With a fixed-rate mortgage, you have the assurance that your mortgage payments will stay the same over the life of the loan. A variable-rate mortgage, which typically starts out at a lower monthly cost, may allow you to buy a home you otherwise could not afford. However, you may face higher rates—and payments—later in the life of the loan. If you think your income is likely to rise enough to afford the higher payments, that may be a chance you’re willing to take. It is worth noting, too, that you may be able to refinance a mortgage when interest rates or your personal situation change.