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How Do I Know Who to Choose to do My Mortgage?

These days every new borrower (and Realtor® in business wanting a mortgage for their clients!) wants to know how to choose a new mortgage company and/or mortgage banker or broker to put together their mortgage.

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"I will definitely keep u in mind, Eileen, for any upcoming clients I may have, you were ontop of it and kept in close communication w/me which I loved!! I would be glad to help any of your future clients."

...Shannon Byrdsong/MetroBrokers-GMAC

With all the new laws causing mortgage companies and former brokers to go out of business, the current economic and banking crisis causing even more drop-out--- and the bombardment of TV and Internet advertising to the general public (most of the ads misleading or wrong!), it's no wonder borrowers have confusion over who to trust and what's going on.

It should DEFINITELY no longer be about "I'll pick whoever will give me the best rate"---- since as of about August 2008, rates are...

... so highly volatile, change all day long and between the different lending banks--- just like the stock market. I don't see this phenomena changing anytime soon.

The "best rate" might not be a benefit to you at all-- I could tell you I could get you a rate of 1.5%, that the APR would be only 1.9%, put that on your good faith--- but it's due in 4 equal payments!

If you only want to know “what the rates are”, see any offer or any piece of other advertising. They are volatile FROM ANY COMPANY/LENDER and vary depending on your personal situation (credit history, credit score, income and its source, debts in relation to your qualifying income, liquid and other assets) and vary depending on the type of house you want/have and ONLY LOCKS WITH AN ADDRESS.

A rate can only be guaranteed at time of LOCK, not on quote, not on good faith estimate--- ONLY on LOCK, and the lock is only valid for usually 30-40 days, and can only be locked against a property address and stays with that property address and borrower’s personal financial situation.

So how does a borrower go about choosing a mortgage person/company to help them?

1. Check to be sure the mortgage person is fully licensed, background checked, fingerprinted, bonded and insured. Depository banking loan officers from your neighborhood credit union or local/national bank do NOT have to be licensed!

2. Check out the reputation of the mortgage company itself--- is it rated with the Better Business Bureau, does the company give you ready access to it's BBB rating? Are they members of a local or national Mortgage Association like CMLA (Colorado Mortgage Lenders Association) or CAMB (Colorado Association of Mortgage Brokers) or NAMB (National Association of Mortgage Brokers). These types of associations watch their members' actions for YOU.

3. Can the mortgage company offer you FHA or VA government backed loans? Doing so causes the mortgage company to jump through all kinds of regulatory hoops--- and the company gets audited EVERY YEAR for Federal and State compliance just to remain part of these programs! This is a great way to begin to separate out a company you WANT to work with right up front.

4. If you sign up with a company like Lending Tree or Getsmart or other online service to match you with a "best offer lender"--- check out the online company taking your information to see if they pre-screen and check compliance and financial statements of the lenders that will be contacting you on their behalf.

5. Does the mortgage company own it's own corporate headquarters building(s) --- means stability!--- or do they lease out of a corner office somewhere?

6. Does the mortgage person/company offer you secure technology to actually shop the best rates for you when you are ready to lock a rate?

7. A mortgage banking company (different than a mortgage broker) can streamline the entire mortgage process for you because they have access to the lowest wholesale rates from the various lending investor banks themselves--- and through their technology can offer a multitude of loan types and the matching wholesale rates to their clients. They cut out the "middle man" (broker) for you.

8. Does the mortgage person offer a STRATEGY of the loan just for you? With all the mortgage changes and different types of loans available, having the "best rate" does you no good if you get to the closing table and that "best rate loan" can't close with your personal situation, or costs you far more than the good faith indicated, or now includes a PREPAYMENT PENALTY--- and now you have surprises and decisions to make LAST MINUTE.

9. Does the mortgage person have a reputation for closely monitoring your loan process for you behind the scenes--- there are a LOT of people and companies to coordinate once you say yes...Realtors©, sellers, title companies, appraisers, lending banks needs, document companies, underwriters, insurers, etc.

10. Does the mortgage person FOLLOW UP with you and have a reputation of following up with you AFTER they take your application?

11. Does the mortgage person find out what YOUR goals are, what YOU want the loan to look like, find out WHAT'S IMPORTANT TO YOU ABOUT YOUR MORTGAGE before they rattle off impressive sounding terms and rates to you? There should be all kinds of questions to you about your house and/or house buying project--- when, where, what, how, etc.

I’m a former Realtor© and real estate investor, a business owner myself and have worked under other mortgage companies/brokers in my past too.

I know some of the horror stories and some of the wonderful stories that go on in the real estate and mortgage industry and between their relationships. Unfortunately I know about the “tricks in the trade” that can harm your choice of the best mortgage for you and I can SHIELD you from those.

Email me if you need someone to easily put together a mortgage for you: eileencarda@gmail.com

"I will definitely keep u in mind, Eileen, for any upcoming clients I may have, you were ontop of it and kept in close communication w/me which I loved!! I would be glad to help any of your future clients."

...Shannon Byrdsong/MetroBrokers-GMAC

About

This page contains a single entry from the blog posted on February 23, 2009 12:34 PM.

The previous post in this blog was SELLERS, Reach out to MORE BUYERS by Offering an FHA Loan Sale!.

The next post in this blog is POSITIVE PERSPECTIVE - Curtesy of Land Title.

Many more can be found on the main index page or by looking through the archives.

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