Banks, private lenders and credit unions are traditional mortgage lenders. Banks and private lenders are almost the same, with the profit being the primary motive. Credit unions act in the best interest of the members and should be trusted more. Because the profits earned by a credit union are meant for the benefits of the members therefore, the lending rates in the credit unions tend to be lower. However, not everybody is a member of a credit union and not all private lenders are bad.If you’re looking for more tips, Mortgage Lender Muscle Shoals has it for you.
Before you start making enquiries, know the difference between a mortgage banker/lender and a mortgage broker. Mortgage lenders are those who actually fund loans, whereas a mortgage broker is one who acts as a middleman and arranges loans from mortgage lenders for a commission. A mortgage banker has only one product to offer, his own loan plan. However, a mortgage broker has the knowledge of a number of lenders and can suggest the best option for you. A mortgage broker can also make your loan application look appealing so you have better chances of getting approval for your loan.
Taking reference from trusted friends that have already taken loans and have the experience is the first step towards zeroing in on a good lender or a broker who would eventually lead to a good mortgage lender.
The reputation of the mortgage lender should be considered. Certainly, you do not want a fly-by-night operator and would prefer a trusted name in the field. Do a bit of background verification before deciding on a lender. The firm size of the mortgage lender should be such that it is big enough to have the pull and small enough to give you personal attention. Select a mid sized firm. A single person may not be able to give enough time to attend to your problems. In addition, a huge firm will make you run around by passing the buck in case there is a problem.
Compare the rates quoted by different lenders. Find out if your lender has told you everything that needs to be told about a mortgage type including all the risk factors. A good lender is one who tells you about all the risk factors involved beforehand and does not shock you afterwards with sudden increases in the payments. A lender who explains about all the possible risks and leaves it to you to decide is the one to be trusted.
Observe if the lender is just trying to push loan packages or is listening to your needs. A broker or a lender who listens to your typical needs is more likely to deliver the goods.
You can fill out applications online with many mortgage lenders and compare their responses. There are some sites that require only a single application form to be filled out and the responses from competing mortgage firms are sent to you separately based on your application. This system is the best way to study and compare the rates and terms offered by mortgage lenders. They also offer mortgage-calculating tables that make the task of knowing all your payment calculations before hand easier.