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How To Choose A Mortgage Lender

How to choose a mortgage lender, even if you’re a first time home buyer!

Unless you’re paying cash, you’re going to need to find a mortgage lender when buying a home. But with all the options out there, how do you choose? There are a lot of large companies out there advertising their services on TV and online. How do you know which lender is good and which one to skip? Here’s the thing: Not all lenders are the same, and big companies aren’t always the best option. That’s why we we created this article and this video: How To Choose A Mortgage Lender (even if you’re a first time home buyer.)

Some highlights from the video:

Ask your real estate agent. A priceless asset you have when buying a home is the opportunity to work with a real estate agent. They will have experience with lenders in your market, can recommend you some options. An agent won’t recommend a lender unless they have confidence that you’ll be treated well, and the loan will close.

Most agents will recommend multiple lenders. If they at first only recommend one, ask for a few others. The rules are clear: only you can choose your lender. We like to recommend several, because you’re not using OUR lender, you’re using YOUR lender. See the difference? We want this to be the best experience for you that it can be! That means you pick YOUR lender but we will give great recommendations. Again, this is where having a good real estate agent is so important. If you don’t have one, we’ll help you find one, for free.

Choose A Big Bank? Or A Smaller, Regional Lender? We recommend smaller, regional lenders vs large financial institutions. That way you have a lender that actually specializes in mortgages, not a giant multinational bank that has many services, where mortgages are just a department. Ask yourself: Do you want to be on hold with some call center, or would you rather have a lender’s cell phone so you know if things get difficult they are just a phone call or text message away?

Big banks that have ATM’s in multiple states and countries? Nah, don’t recommend. Smaller, regional lenders build their businesses on great experiences and customer service. They are more accessible and WANT this to be a great experience for you so you recommend them to others!

Interview Lenders. Speak to lenders personally. This is an interview! They will not charge you for asking questions! Talking to lenders will NOT kill your credit! Here’s what you want to ask them about:

    1. Accessibility: How accessible will they be? Does someone answer the phone or return calls on weekends? What are their business hours? Can you always work with the same person, or a few people on that person’s team? (That’s good.) Or are you going to be connecting with a call center where you get a different person every time who has no knowledge of who you are and what your situation is? You want to be comfortable with the person you’re working with! Can you get a new pre-qualification letter on a weekend so you can make an offer on a home? How accessible are they going to be?
    2. The Process: Are they able to provide an explanation of how their loan process works? Can they give specific direction as to what sort of documents they need now and may need later, and a legit date your loan will be ready to close? Do you feel like the person you’re speaking with is capable and interested in getting you a loan for your next home? For example: We give all of our clients a Buyer’s Playbook with an overview of the home buying process so they can understand how everything works. Choose a lender that is able to explain the process.
    3. Loan Programs: What type of loan programs are available with this lender? What type of down payment will be needed? Not all lenders offer the same programs, and not everyone knows this. Does this lender have experience lending to self employed, or offer loan programs for teachers, police officers, firefighters, corrections officers, first time home buyers, jumbo loans?  What type of loan programs are available to your specific financial situation, which one does the lender most recommend, and why are they recommending that one in particular?
    4. Fees: What are the fees this lender will charge? You can talk about this now with them. Your real estate agent will not have this information, but the lender will. You should understand this ahead of time, so you understand how the process works.

For real estate services in DFW, or free help finding an agent our of town, contact us through our real estate website.

Written by Daniel Burke

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