Finding The Right Mortgage Lender


Finding the right mortgage lender shouldn’t be like a scavenger hunt — the best lenders are not hiding inside a treasure chest. When making a big decision, such as choosing the right lender for your mortgage, you simply have to know where to look, and what to look for.  While you’re searching, you’ll uncover all sorts of options — so get your paper and pen handy to jot down some notes.

SEE ALSO: 5 Questions You Need To Ask At An Open House

Finding Lenders On The Internet

Modern times have created modern measures when it comes to modern mortgage shopping. Your first stop should be the Internet. Aggregate websites like collect interest rates and mortgage information from lenders all over the country, and publish it in one place for reference. Use aggregate websites to shop and compare the options available to you. Narrow your choices down to at least three lenders that you want to have a conversation with before narrowing it down to the one perfect match.

Leverage Existing Relationships

Your second stop should be to speak with a bank with which you already have a financial relationship. Because of your existing relationship, you’ve jumped over one hurdle for obtaining a mortgage – they’ll want to keep your business in-house. Talk with your banker about the loan options available to you. The existing relationship might land you a lower interest rate, or savings on your closing costs.

SEE ALSO: Mortgage Savvy: The Good Faith Estimate

Broker The Deal

A third option is to check out a mortgage broker. This financial professional doesn’t work for any particular lender, but instead, has relationships with a variety of them. He can help you narrow down your lending options, but you’ll pay a fee for his service that can add to your total out-of-pocket expenses. In most cases, however, he can save you money by getting you a better rate than you could find on your own. After you talk to at least three lenders or compare at least three options with a mortgage broker, evaluate each one carefully. Review the interest rate and annual percentage rate (APR). See which lender is offering you the best deal. When you’re comparing mortgage lenders, be sure that you’re comparing the same types of mortgage for a true comparison — a 30-year fixed to a 30-year fixed, and a 15-year fixed to a 15-year fixed. Narrow it down to the point where you have just one lender. Now you’re ready to contact that bank and start your mortgage application. Stop the scavenger hunt and get serious about mortgage shopping. Compare lenders using the Internet, by talking to your existing bank, or enlisting the help of a mortgage broker. Once you have at least three lenders to compare, evaluate each one carefully. All this hard work will definitely land you the true prize — an affordable mortgage.
Date of original publication:
Updated on: November 10, 2015

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