Practical Tips for Mortgage Shopping
Your home is one of the largest investments you will ever make and where you choose to finance it is one of your most important decisions. Not all money sources are created equal. The best advice is to talk to your real estate professional early in the process. He or she can help you decide what is best for you, but here are some practical tips to get you started.
You’re buying a house in Ohio, so why call an 800 number and a loan officer in some unknown, mysterious location? Glitzy television ads and terms like Rocket Mortgage might sound enticing, but you may eventually regret the day you picked up the phone. National companies are by default, huge and that means you are one in a million (literally in some cases) when the rubber meets the road. Even if you find a great loan officer, they will not be making final loan decisions and have no direct contact with anyone who will. This can cause lengthy delays and uncertainty when you need it most. When closing time comes, many find themselves exhausted by the process. At this time you need definitive answers. Keep this in mind when weighing local versus national lenders.
Ask Lots of Questions before Signing on the Dotted Line
At a bare minimum, ask your lender about the interest rate, loan term, if you’re paying points, and how much will you pay in closing costs. But don’t stop there! Find out if the bank has in-house underwriting. An underwriter’s job is to review all the information you provide, assess risk and ultimately decide if you will get the money for your home. It does not guarantee a smoother process, but in-house underwriting is more of a team approach. Your loan officer will have more direct contact with this person and should be able to get quicker answers.
Applying with more than one mortgage company within a 30-day window should not impact your credit score adversely. You will find that terms and answers to the questions above can vary widely, so don’t be afraid to comparison shop for the best option.
Ask Others About Their Experiences
Again, start with your Realtor®. He or she is entrenched in the industry, so who better to ask? You can also rely on friends, family members and online reviews to narrow down choices. Social media is a prime place to pose the question to contacts who are usually more than willing to provide opinions.
Shopping for a loan is a lot of work but don’t let it deter you from achieving your real estate goals. The effort you put in will pay dividends.