Finding the right mortgage lender shouldnt 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 youre searching, youll uncover all sorts of options
so get your paper and pen handy to jot down some notes.
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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 inmyarea.com 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, youve jumped over one hurdle for obtaining a mortgage theyll 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 doesnt work for any particular lender, but instead, has relationships with a variety of them. He can help you narrow down your lending options, but youll 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 youre comparing mortgage lenders, be sure that youre 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 youre 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.