Working With A National vs Local Lender On Your Mortgage
Buying your home is most likely the largest purchase you will make in your lifetime. Unless you've just recently won the lottery or have a very generous rich uncle, you will need to qualify for a mortgage. When you begin to research lender options, knowing how to choose can be difficult. What is the difference between a local lender, mortgage lender, mortgage banker or credit union? And what do those variations mean to you as the consumer?
Working with a local lender that comes recommended from your real estate agent, friend or next door neighbor carries a lot more weight than one you randomly find online. In fact, a recent study shows that 90% of consumers trust recommendations from people they know, like and trust.
It is a common misconception for people to assume that their bank will give them the best mortgage. However, the fact is that if you limit yourself to going directly to your bank and getting a mortgage from them without looking elsewhere you are most likely shooting yourself in the foot. You are restricting the possibility of other options that might be better for you and this is never a good thing.
By looking outside of your bank, you may get yourself a quarter or half a percentage point off, which might seem small but can actually turn out to saving you thousands of dollars in interest payments. In addition to this, you may find other incentives or better options that you'd want to consider.
Sitting across from your local lender while they explain the loan process is very different than trying to track someone down that is across the country. How uneasy does it make you feel when you call to ask a question only to find out that the person you are talking to is not even qualified in your state to answer that question?
When you are sitting face to face with someone, it's very difficult to hide behind a computer screen. Working with a local lender allows you to go through every detail of the loan with a real person, not someone on the other end of a phone line.
Lowest Rate & Fees
Contrary to what national lenders may tell you, a local mortgage lender will be able to offer you the lowest interest rate, lowest fee, and the best customer service available. Just because they are smaller does not make them less effective. In fact, their comparatively smaller size gives local lenders more flexibility to respond to you faster, and less costs to overcome.
Best Loan Products
Many national mortgage lenders are filled with loan sales representatives that will sell you a loan product regardless of whether or not it is in your best interest. They are only interested in the numbers game and it has nothing to do with what numbers work best for you. They worry about their bottom line, not which loan program is right for your family. Working with a local lender ensures that they have an established reputation within the community. And if it is not a positive one, well - you should find this out through word of mouth and your research.