How to Select a Mortgage Lender
One of the most important decisions you will have to make in terms of your home mortgage will be which lender to go with. Nowadays, there are almost countless mortgage lenders all happy and ready to take your loan application. But that doesn’t mean their offer is the perfect deal for you.
Below are five tips for choosing a good mortgage lender:
1. Decide whether you’ll want a mortgage broker.
Using the services of a mortgage broker has its benefits. A broker will do most of the work involved when you’re trying to find lenders, which means you enjoy time and energy savings. But there are drawbacks as well, such as when they bring you a lender that gives them the biggest commission, regardless of whether this lender is the best for you or not.
Should you decide that a broker will be helpful to you, take the time to do your homework. Ask for references and listen to other homeowners about their experiences with the broker you’re eyeing. Brokers who don’t give you client references should be avoided because clearly, they are hiding something.
2. Know what kind of lender you want.
Are you thinking of a small lender or a large company? If you want a lender that can offer personalized customer service, choose a smaller lender that is known in your community. If you’re more concerned about getting the best interest rate, then consider a bigger lender. If you know the differences among lenders of varied types and sizes, it will be easier to see which one is actually best for you.
3. Ask for personal referrals.
Of course, a broker is not the sole way you can find mortgage lenders. Ask for personal recommendations from friends, relatives or colleagues who might have purchased a home in recent years. This is a great way of cutting through the ocean of prospective lending companies out there.
4. Meet with your agent.
Good agents do not limit their recommendations to their in-house lenders, and good loan officers provide good care to customers who come to them on an agent’s recommendation. Use this to your full advantage, and ensure that the lender knows that you came on your agent’s recommendation. This will not only work as an icebreaker, but it can also be a huge help to you as far as lowering closing costs is concerned.
5. Choose a lender with a good reputation.
Finally, whatever you heard about a lender, whether from relatives, friends or coworkers, make sure to do a background check. Find out as much as you can regarding the company to avoid future headaches.