5 Things To Consider When Choosing a Mortgage Lender

The past year, as we have faced the challenges of COVID-19, we have changed a lot as a society! We have moved ourselves indoors, many of us have changed jobs--many more have changed the way we do our jobs and attend school! My family works from home and attends college and high school from home. We found ourselves quickly adapting spaces of our home to give everyone a spot to learn or work. However, many families found themselves struggling to make "quarantine life" function in their current homes--and found it time to buy a first home or sell an existing home for something better suited. If you are also planning to buy a house--finding the perfect home is just one piece of the puzzle. It would be best if you found the ideal mortgage lender too. What are some things to consider when choosing a mortgage lender?


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Check the Ratings and Reviews of the Lender--Keeping an Open Mind. While it is essential to check lender reviews--it is also important to remember that (1) reviews may not always be 100% honest, and (2) you cannot please every borrower every time. While positive reviews are excellent--read the negative thoughts and look for important things to you. A person complaining because their credit score didn't qualify for good rates is worth an eye-roll--but multiple people complaining about a specific loan officer offering poor customer service or the lender having skeptical practices (like bait and switch actions or zero communication) are worth some consideration.


Do Some of Your Own Mortgage Loan Homework Before Reaching Out to Lenders. You may have a general idea of where your credit score falls--but, the credit model used by the mortgage lender may return a different score than expected. Go into the initial phone call or meeting with some research and knowledge under your belt. Make use of online calculators to determine the monthly house payment you think you can afford or how much of a down payment you can manage. Learn about debt to income ratios and income requirements that determine your home buying budget. 


If you don't have a down payment or your debt to income ratio presents challenges--don't be discouraged--you have to find a lender that offers a no-money-down program that fits the rest of your credit/income/asset profile. Even if you don't qualify for a mortgage today, a skilled loan officer may also advise you to help you get your finances in order and qualify later on. It will be more beneficial for you to go into the first mortgage loan application meeting with an understanding of the mortgage loan vocabulary--and the ability to answer the loan officer's questions regarding down payment amounts, etc.



Pinnable list of things to consider when choosing a mortgage lender


Do you Want a Virtual Lender--or an In-Person Experience? Some lenders operate 100% online and via phone/fax/email contact. With today's technology, you may never meet your lender face to face. Documents are faxed or directly uploaded, applications and paperwork are e-signed, and loans close at the realtor's office or a local title company or attorney. If you are not ready for a virtual lending experience--you will have to seek a local lender with appointment availability--and loan programs that fit your needs. 


Find a Loan Officer with Experience. A busy loan officer who has been working in the mortgage lending industry for 20 years will be a far more tremendous asset to a home buyer with a problematic credit or job history than a newbie. The newbie may not know some of the potential problems your loan application may hold --or may not learn ways to correct those problems or work through them. A more experienced loan officer may cost more--but you do get what you pay for too! He may be slower to respond to your calls because he is simply busier. An experienced loan officer could be the reason your mortgage loan closes on time--or even avoids denial if problems arise.


What is the Expected Time From Application to Close? Is your lender looking at 30 days to close a new home purchase--or is it taking 45 to 60 or longer? Lenders are busy when the home buying market is booming. The home buying process can be a rather complicated one--and takes time to complete all of the requirements. With the numbers of new home mortgage applications remaining high many borrowers find that the process takes even longer than it did before! When the home market is booming--buyers have a difficult time getting into contract. If you can offer a seller a 30 or 45-day closing date with your lender vs. a 60 to 90 day close--that may make your offer more attractive to the seller!

Many people get so caught up in the rates and fees of lenders--that they forget other considerations as they choose a mortgage lender. Buying a home is one of the most significant life decisions most of us make! Educate yourself in the home buying lingo--and take the time to find a lender who is best suited to your needs as a whole.

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