You are about to make the most important financial decision in your life – Getting a mortgage. When it comes to mortgage, the competition is fierce and it is crucial that you choose your lender wisely. Here are a few characteristics that are common to all the good lenders.
1. A good lender is very detailed and particular about the documentation in pre-approval phase. You will never hear him say something like, “Don’t worry about the paperwork. It’s nothing to be serious about. We will manage.”
2. Whether it is about any glitch in your credit report, the closing date of a due fees or any update in the mortgage rate, a good lender is likely to keep you informed. He sends clear and constant messages rather than getting you confused in the technical jargons.
3. He may not offer you luring rates, but he will disclose all the fees and charges involved, hidden or otherwise.
4. He will never ask you to make your decision in haste.
5. He will have valuable resources to help you make an informed decision such as blogs, video posts, questionnaires, mortgage calculators and financial tools.
6. Good mortgage professionals ask for all the information they need upfront. If they feel you are not right for the loan or the loan is not right for you, they will clearly communicate it to you rather than luring you with plans that do not meet your needs.
7. He is organized and follows a standard protocol when it comes to processing your application.
8. He strives to offer you the best loan terms on your deal.
9. Before he offers his own propositions he listens and tries to understand your needs and financial caliber. He suggests plans that fit your mortgage needs well. He lets you make a choice rather than confining you to a plan that is profitable for him.
Make a Smart Choice
You should never hesitate to ask your lender his Good Faith Estimates (GFE) statements. To assess his credibility, you can look at the customer reviews. A review is the best tool to help you choose a lender on various parameters such as knowledge and responsiveness.
A smart way of spotting a bad lender is to ask questions, lots of them, both in the pre-approval and the post-approval phases. The questions can be related to loan program, interest rate, lender fees, monthly payment, etc. Here are few examples –
● What is your best interest rate?
● How do you arrive at this rate?
● Can I lock the interest rate and if yes, how?
● What mortgage plans do you offer?
● Which one do you recommend and why?
● What are the closing costs?
● Is there a prepayment fee involved?
Listen to his answers carefully, is he too concerned about locking the sales, is he knowledgeable, is he resolving your mortgage needs?
If the lender is really good, chances are thick that you will hunt him rather than him hunting you down. Poor lenders rely on soliciting when it comes to finding a customer. In contrast, bad lenders find their customers through referrals from their loyal customers. Satisfied clients bring in new customers through positive reviews and testimonials.
Here’s the thumb rule to follow – Good lenders think and act in customer’s interest and never try to exploit his hopes and vulnerabilities for his own profits. Bad lenders are precisely the opposite.