Outside of finding the right home to buy, the most important decision you can make as a homebuyer is where to get financing. Ultimately, the lender you choose will not only impact your loan options and your monthly payment, but how smooth the process will go as well.
The problem? There are a ton of mortgage lenders to choose from. How do you know which lender is right for you?
While it’s not a complete list, here are five traits we think are non-negotiable.
A Variety of Loan Options
There’s no one-size-fits-all mortgage for every homebuyer. Because every borrower is different, a good lender will offer a diverse range of financing options.
This will include conventional loans for borrowers with strong credit and financial history to government-backed options—like FHA, VA and USDA loans—for low- and moderate-income borrowers who may not have much savings. If you’re looking to buy a home in a high-priced area, you may want a lender that offers jumbo mortgages, adjustable rate loans, or specialized programs for self-employed borrowers or those with unique financial needs.
Competitive Rates and Terms
This one is a little tricky. Many lenders compete for borrowers by claiming they have the lowest rates. Interest rates are important, of course, because the rate you’re offered will impact how much your mortgage payment will be. But it’s not the defining trait of a great lender—nor should it be.
In fact, the best lenders are rarely the ones that offer the lowest rate. They do, however, offer rates that are competitive with other lenders, as well as flexible terms that cater to your specific financial needs. For example, choosing a lender with a slightly higher rate than a competitor may pay off if they have a local and experienced operations team and dedicated loan officers to make sure you get the service you deserve and your loan closes on time.
A Simple, Streamlined Process
Even under ideal conditions, buying a home and getting a mortgage can be stressful, simply because it’s the largest financial decision you may ever make. However, a great lender will do everything possible to make the experience as easy, fast and seamless as possible. It typically takes 30 to 45 days to get to the closing table with most lenders. Great lenders, on the other hand, will usually take 30 days or less.
If you’re unsure what type of lender you’re working with, ask if they offer any type of assurance that your loan will close on time. For instance, at Right By You Mortgage, we offer an on-time mortgage closing guarantee for qualified borrowers. If you’re eligible, we’ll pay both you and the seller of your new home $500 each if your loan fails to close on time.
Personalized Customer Service
A great lender has a team of loan experts who are willing to walk you through every step of your homebuying journey. This level of individual attention makes a significant difference in turning the often-daunting process of buying a home into a more manageable and enjoyable experience.
Your loan officer should be a superb communicator who is ready to answer any questions you have, and understands there is no such thing as a “dumb question.” They should also take the time to understand your personal goals and find the right mortgage options that fit your needs and be ready to help navigate any hurdles that arise.
Local Market Expertise
While they have their advantages, large national banks and online lenders are often unaware of local market dynamics that can impact your mortgage experience. Local lenders, on the other hand, understand local home sale trends as well as local ordinances, tax rates and business practices that impact borrowers.
Local lenders are usually more reliable, too. Plus they typically have access to a network of service providers in your market, such as financial planners, real estate agents and contractors, who can help make your homebuying journey go smoothly.
At Right By You Mortgage, these five traits are embedded in our DNA. If you’re thinking about buying a home and need a lender you can trust, find a local loan officer near you or email us at inquqiries@rightbyyoumortgage.com to get started.