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Choosing The Right Lender
By: Max Hunter iSnare Expert Author
The real estate market has been hot for many years. The real estate market
stayed hot even though the economy has been on a virtual roller coaster. This
has resulted in a large number of mortgage lenders entering the market with
varying mortgage programs for people with different economic backgrounds and
credit histories.
Home loans are now available for people with pristine credit, good credit,
average credit, below average credit and even bad credit. There are loan
packages available for people with large down payments, small down payments and
no down payments at all.
For many first time homebuyers, choosing the right lender and the right home
loan package may seem like a daunting task. There are so many competing lenders
promising so many different things. They see advertisements for amazing interest
rates and packages. Of course, those packages are only available for a small
percentage of homebuyers who fit very specific criteria.
Many first time homebuyers fall into the trap of applying for home loans through
various lenders offering different loan packages. While on one level this may
seem like a good idea since it, at least in theory, opens up the number of
possibilities for obtaining the right loan package for that homebuyer, the
simple truth of the matter is these group of lenders may actually have less
mortgage packages at their disposal, even added together, than some lenders and
lending networks will have individually.
If you apply to a number of home loan lenders, each will invariably run your
credit report. An inquiry on a credit report is noted and will affect your
overall FICO score. Your FICO score is a credit score that compares you to all
other people in the country with a credit history. This number can put you in
certain mortgage programs and take you out of others. The last thing you want to
do is engage in any activities which could lower your FICO score at the time you
want it to be the highest possible.
With proper homework you can find a mortgage lender or network of lenders that
will have enough loan packages at their disposal to have one that is right for
you. The more they have at their fingertips the more likely it is that they can
create a mortgage package that fits your unique circumstances. Even if you think
your home loan will be fairly straightforward you may still benefit from a home
loan lender that has a number of varying packages. Perhaps they can show you
unique ways to have lower payments, avoid PMI, reduce the down payment you were
going to make without it impacting your monthly payments and so forth.
Most first time homebuyers are typically unaware of the nuances involved in home
loans. They are typically unaware of things like PMI, escrow payments, fixed
rate loans versus variable rate mortgages and their respective benefits and
drawbacks. A skilled mortgage lender will be able to explain these differences
and show you a number of different options, including the option that may be
right for you.
It is important to completely honest with your mortgage lender, unfortunately,
too many homebuyers try to pull the wool over the eyes of the lender - this
never works. In the end everything comes out in the wash - the more honest you
are upfront the more options your mortgage lender will be able to review for
you.
Look for a lender that clearly states that they can assist people with various
types of home loan packages, including differences in credit history, employment
history and down payment size. Again, the more tools they have in their toolbox,
the more likely it is that they can craft the right loan for you.
Many websites now offer pre-screening services that can match you up with the
right lender without each lender running your credit. Accurate and honest
information is important when using these websites otherwise you may be paired
with the wrong lender which will delay your getting the loan you need and could
also hinder your chance to get the home you are hoping to get.
When speaking with your lender you should always feel comfortable to ask
questions. The lender may not always be able to give you an instant response,
but you should prefer that they find out the answer before giving you a quick
but wrong answer. You should also feel that your lender is giving you honest
information. If you feel like he or she is lying to you then that is not the
right lender for you to be working with.
It is a good practice to provide your lender with whatever information they
request. Never give them an original document and always make sure you have
additional copies of anything they request. Calendar all cut-off dates they give
you and make sure you stay on top of it. You will want a lender that is
responsive to your inquiries and prompts you when things are needed or cut-off
dates are approaching.
Picking a lender is picking a partner. You want to find the right partner for
you that will be able to provide you with what you need while you provide them
with what they need. Together, you and the lender will have you well on your
road to homeownership and a stronger financial portfolio.
About the Author:
Max Hunter is the author of many credit related articles. If you are looking for help with Home Loans or any type of credit issue please visit us at http://www.homeloanave.com |
