Should I Allow Lenders To Compete For My Business?
When you fill out an Internet form for mortgage rate comparison websites, you will have lenders competing but they may drive you crazy in the process. What may not realize is that you might be showered with aggressive sales people all competing for your business. Unless you like to talk to sales people in your spare time, the process will drive you nuts. In theory it makes great sense. Competition is great; you just want it to be the right kind of competition. Playing the multiple lender game can become a sales pitch nightmare.
What these sites do not want you to know is that you can accomplish the same thing by dealing with just one reputable mortgage broker. A mortgage broker has dozens of mortgage wholesalers to get mortgage loan programs and interest rate quotes from. An individual mortgage broker can get mortgage quotes from a variety of sources such as Bank of America, First Horizon, Ohio Savings, Washington Mutual, Wells Fargo, Countrywide, Citibank, Flagstar, World Savings, Chase and National City to name a few. A single mortgage broker can deliver you dozens of mortgage quotes from multiple lenders that they deal with. As long as you are comfortable and confident with the person that you are dealing with, they can save you hours of aggravation and pesky sales calls.
On the other hand, banks can only give rate quotes on the loan products that they offer, and this limits the choices of the buyer. This is probably why banks have been trying to get mortgage brokers wiped off the lending landscape. A mortgage broker is not locked into any particular lender or money source. Interest rates change daily. A good mortgage broker can change with the fluctuations to deliver you the best interest rates offered by the different lending institutions, and will get you to the lowest interest rates because they get paid the same regardless of what lender they use. Get the picture?
The other piece of the lending puzzle many individuals do not consider is using a local lender for the home buying process. Using a lender on the Internet may mean you’ll be speaking with someone hundreds, and even thousands of miles away. If you have a problem with your loan, I’m sure you would want the option of getting in the car and going to visit with your mortgage broker in person so you can speak with them face to face. Problems do occur in a real estate transaction.
Educate Yourself About the Loan Process
I am consistently shocked at how many potential borrowers know nothing about the person that is originating their mortgage. A mortgage, for most of us, me included, is one of the most important financial decisions that you will make in your lifetime. You probably wouldn’t pick a stock broker in this manner, why would you pick your loan officer like this? Using an Internet lender that you have never seen or met is gambling. There is no reason to do this. Work with someone that you know and trust.
Look for a lender that has been in the mortgage business for a minimum of 5 years.
Ask them if they could have the phone numbers of the people that have closed loans with them in the last 30 days. There are a lot of people that drift into the industry looking to make a quick buck.
A true professional will have an interest in assuring that your experience is a positive one. They are motivated to have positive referrals and their reputation is important to them.
Completing a mortgage takes expertise. It should be fairly easy to spot a slick salespersob from someone who is a professional consultant.
The Internet is a powerful tool in the financial markets. Make sure that you do a little research; when it comes to business, personal relationships still rule. Talk to your friends: Do they have a mortgage? Who did they use when they bought their home? Ask them if they would recommend the person that did their mortgage to you.
If you are considering using an ‘out of town’ mortgage company for your mortgage I want to offer one big tip. Make sure your Realtor, who is local, makes contact with your loan officer so that they stay in close contact during the transaction. Keeping your Realtor in the loop will allow them to work with the seller if you should run into trouble with your financing.
Article by Richard Yanez, Mortgage Broker
For more information, visit Do you really win when your online mortgage application is sold to many companies?