4 Tips for Selecting the Right Mortgage Lender

Aug 13, 2018 Homebuyers Share:

You may want to select a lender before beginning your process. While there are some buyers who do pay cash for a new home, most will need to find financing. Pre-qualifying before house hunting puts you ahead of the game. Knowing how much home you can afford and what you qualify for is a great step. Each lender is different so be sure to choose one that will work with you and your circumstances. Some type of lenders to consider include Independent Mortgage Companies, Savings Institutions, Commercial Banks, Morgtage Brokers, Credit Unions, Employers and even your Union.

You will also need to decide on which mortgage is right for you. Since you’ll likely be saddled with a mortgage for years to come, it’s important to make sure you shop around and choose the best mortgage lender for your needs. Here are four tips for picking the right mortgage lender.

1. Ask Around for Mortgage Companies

Ask your friends, family members or coworkers who have purchased a home within the last few years about their lenders. Getting referrals from those close to you can help you cut through the sea of prospects to find someone you know you can trust.

2. Talk to Your Real Estate Agent

A good agent will not limit recommendations to his or her in-house lenders, and smart loan officers take especially good care of customers recommended by real estate agents. Use this to your advantage, and make sure the lender you speak with knows you came to them through a recommendation from your agent. This connection can not only be a good icebreaker, but it can also be a big help when it comes to reducing closing costs.

3. Decide What Kind of Lender You Want

Do you prefer a small lender or a large lender? If you are someone who prefers more personal customer service and a lender who knows your name, you would likely want to go with a smaller lender. If you care more about getting the right interest rate, a larger lender may be your best option. Researching the differences between larger lenders and smaller ones will help you decide which fit is best for you.

4. Research the Lender's Reputation

No matter how you hear about a lender- whether from a family member or a website - it is imperative to do a background check. If you can get names of past clients, make sure you speak with them. Check online reviews and don’t hesitate to bring up any questions you have with a potential lender. Learning as much as possible about who you might be dealing with can save you a number of headaches later on.

Shopping around for the right mortgage lender can be daunting. There are numerous lenders available and more seem to be popping up online daily, so it’s hard to tell right away which are the bests. To find the right lender, it's important to know what you're looking for and to do as much research as possible.