How to Select a Mortgage Lender
Among the most crucial decisions you will probably make when it comes to your home mortgage is which lender to select. 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 if you will work with a mortgage broker.
Working with a mortgage broker comes with benefits. A broker saves you time and energy by taking care of a big portion of the work of finding lenders. But there are drawbacks too, as when they get you a lender that offers them the highest profit, never mind if it’s not the best for you.
If you decide that you need a broker, take the time to do a bit of research. Ask for references and listen to other homeowners about their experiences with the broker you’re eyeing. Brokers who hesitate to give references from previous clients must be hiding something.
2. Know what type of lender works best for you.
Do you prefer a small lending company or a big one? 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 inclined to choose a lender for its interest rate, then a bigger one might be your best bet. Knowing the differences among lenders of different types and sizes will help you determine which one is particularly best for you.
3. Seek referrals.
Definitely, it’s possible for you to find mortgage lenders without the help of brokers. Seek referrals from people you know – friends, relatives, coworkers, etc. – who may have bought a home recently. This is your best way to cutting through the entire sea of mortgage lenders that you can choose from.
4. Talk to 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 can not only serve as an good icebreaker, but it can also work to your favor in terms of reducing closing costs.
5. Pick a lender with a positive reputation.
Finally, regardless of what you hear about a lender, always do a background check.
Lastly, no matter what great things you heard about a lender, whether from family or friends or online, a background check is imperative. Find out as much as you can regarding the company to avoid future headaches.