Choosing the Best Mortgage Lender for You

Whether you are buying a new home or refinancing your present one, your selection of a mortgage lender is an important decision.  But how do you know which one is the right one?  Here are some considerations when looking for a lender that is right for you:

Lender Reputation
Make it a point to learn the lender's track record for integrity, timeliness, and professional service.  Also find out if, more often than not, their loans close within their Good Faith Estimate -- the written list of costs associated with closing your transaction.

Ability to Meet Your Needs
Does the lender have a loan program that best suits your specific needs?  All lenders do not offer the same array of loan options.  For instance, not all lenders handle government-backed loans such as Federal Housing Administration (FHA) or Veterans Administration (VA) loans.  Therefore you need to clearly understand what each lender on your list offers in light of your needs, objectives, and timelines.  Also consider the lender's experience at handling the different loans offered.  They may specialize in certain loan types, handling many of that particular loan but rarely handling others.

Listening vs. Selling
Pay close attention to whether you get listening time or hear a push for loan programs offered.  A good lender listens in an effort to understand your needs. This demonstrates a genuine interest on their part in helping you with your particular financing scenario.  They should enthusiastically help you navigate through the many alternatives and options and then offer you the most suitable loan. 

Fast or Straight Talk
Do you get straightforward answers to your questions or vague and seemingly "canned" responses?  Are discussions in layman's terms or packed with financing jargon and acronyms?  You should look for a lender that provides clear, direct answers to all of your questions.  A lender that is not willing to take the time to address your questions and concerns and to explain terms and requirements in a way that even a novice can understand should drop from your list for consideration.

Comfort Level
Even though your comfort level cannot be quantified, it is still important.  A mortgage is a significant commitment.  You deserve a reputable, competitive lender that will go the extra mile and that you feel comfortable with.

Competitive Stance
You would be remiss if you did not consider financial aspects as well as the non-financial considerations already mentioned.  You want the best interest rate for the loan that meets your needs; the option of securing a rate lock which commits the lender to a specific interest rate; and the best costs and terms for your mortgage.   If the financial picture is not attractive, keep your search going.

How do you find lenders to choose from?   Ask for referrals from friends and family.  Also check with local real estate agents who interact with many different lenders and are familiar with lender track records and reputations.   Remember that a good lender is a very valuable asset in your real estate transaction.  Get information about and from each lender you are considering.  Ask questions and get them answered.   Compare each lender against your list of considerations.  Then choose your lender and close your deal.

Information is for educational and informational purposes only and is not be interpreted as financial or legal advice. This does not represent a recommendation to buy, sell, or hold any security. Please consult your financial advisor.