Here is a list of the top 5 things you should know before you choose which mortgage provider you should use. The order of these can be changed depending on your specific scenario. I would definitely caution you to not make your decision based solely upon or mostly upon the rates. While that is certainly a very important aspect to all loans, there are more factors involved that may easily warrant a slightly higher rate to do what needs to be done. Just watch out for that trap. The moral to this article is to shop your mortgage and make sure you are comparing apples to apples when making your decision.
These are some basic parameters that industry professionals would ask and know before we would send a lender our own personal business. Do NOT be afraid to ask these questions and look for honest answers and ask for numbers in writing so you can compare.
Some helpful advice to assist you in Managing Your Mortgage.
What are my options?
Programs available: Does this lender have options for me that I can be sure that I am getting the best choice of a mortgage product for my specific loan scenario? Are other options being explored or discussed so I can be sure what I am getting is the best choice for me?
Cost of the loan
Costs: What are the lender fees (junk fees) associated with getting my mortgage at this particular lender? Have I shopped around enough to get a feel for what the fees and expenses should be around? Have I compared the APR from the potential lenders I am considering? Have I compared the “Origination Charges” listed on the Good Faith Estimates that I am getting from each lender to make sure which place has the most aggressive expense structure?
Rate: Have I been quoted the best rate from each lender I am shopping? Am I comparing apples to apples when shopping for the best rate? Are the lock-in periods for my rate quotes the same from one lender to the other for shopping purposes? Are all the quotes I am getting similar with respect to any type of points associated with the rate quote I have been given? (Make sure all quotes from various lenders are for the same scenario, otherwise you will be wasting your time shopping and could easily choose the wrong option!)
Processing/Underwriting: Is the processing done locally with each lender as opposed to centralized processing? Have I specifically asked that question? Is the underwriting done locally? Is the underwriter an employee of the lender I am potentially going to choose? Does my loan have to be underwritten by more than one underwriter/company?
Turn time: What are my potential lenders quoting for turn times for the files they process and underwrite? Knowing it is difficult to be 100% accurate, am I being told very different but honest times? If you are being told less than 3 weeks, be cautious, but if you are being told 6-10 weeks, look for a better alternative. Some of the larger lenders throughout the country are seeing months of time needed to process a mortgage and this is due to volume of refinances in the pipeline. Ask this specific question!