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Take Your Time In Choosing A Lender
Dated: January 20 2015
In my 12 years of real estate experience, helping my clients chose a lender is in my opinion, one of the most important tasks at hand to assist my clients. Why? Simply because I have seen so many lenders that overcharge buyers either providing higher interest rates or offering seemingly low rates while tackling on “origination fees” with extremely high costs or charging “points” to the buyer. When a buyer is charged points, it is the buyer who is actually paying to lower the rate down. Many lenders and even large bank organizations do this and fail to properly explained to the client that while they are getting a low rate it is them, the buyer who is paying thousands to get to that rate down. Basically, choosing the wrong lender could end up costing several thousands in additional closing costs to the buyer creating an burden that could have been prevented with the proper research and guidance.
My advice is to thoroughly investigate the mortgage lender offerings. If a lender pulls a client’s credit, they should get a Good Faith Estimate (GFE) within three days and this is actually a federal law. The GFE will disclose at the time the credit was pulled, which interest rate the lender can offer the buyer, estimated costs such as taxes, insurance, and any other lender associated charges (origination costs, appraisal, and such). This is incredibly useful as this way the buyer not only knows what amount they can borrow, but also how much money they need to make the transaction happen. This way, the buyer can make sure they are okay with the price of home they are looking for and are comfortable with the mortgage payment at that price range, so they will be no surprises.
I typically refer my clients to different lenders depending on their needs, but I actually prefer to work with mortgage brokers. The brokers I work with are extremely experienced and make sure the files are carefully evaluated before they get processed. A mortgage lender will work with several lending sources and can shop around the rate with these sources. The broker will not get pay unless your loan closes, so there is a more vested interest in making sure everything is up to part. They can spot issues right away and make sure my clients work on those potential issues in advance and not right before we close, thus avoiding delays.
I have had many clients that say they prefer to use their own banks until I am able to show them that they are not getting competitive rates. On my last closing this week, my client got a loan with %3.6 percent, his bank had quoted him a rate of %4.25 and was charging him higher closing cost than the lender I recommended him.
Taking the time to research the lender can yield substantial savings, and your agent should assist you in finding competent lenders! Good luck in finding a home and let me know if you are in the Tampa area.
Real Estate Professional, REO Specialist, CDPE® and e-Pro Realtor® "Certified Distressed Property Expert, CDPE ®" "Certified as an Online Real Estate Expert by the National Association of Realtors ®" 1208 E. Kennedy Blvd., Suite 231 | Tampa, Florida 33602
Cell: (813) 679-5307 Fax: (813) 865-0701
Janeth is dedicated to providing her clients with only the highest standards for customer service. She takes pride on being an expert in bringing home buyers and home sellers together throughout the T....
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