Of course, lenders aren’t one-size-fits-all. There are better lenders for different types of buyers, including first-time home buyers, buyers with poor credit, and people seeking a refinance on a current abode.
What qualities should you seek in a mortgage lender? Let’s take a look at what some industry insiders have to say.
5 things to look for in a mortgage lender
If it’s your first time buying a home, you’re going to have a lot of questions. To this end, you’ll want a lender that focuses on customer service.
You may also need a bit more financial help depending on your age and income. So, it’s a good idea to find a lender that knows its way around FHA loans and other programs with low down payment requirements.
Schachter recommends finding a lender that doesn’t only approve perfect-credit, high-worth buyers. “Many times these are out of the realm of their portfolio products, and they don’t focus on the smaller, lower loan amount mortgages. Also, a lender that is a broker (meaning they offer mortgage loans from a variety of lenders) or a banker can offer more product selections.”
Here are five factors to consider when seeking a mortgage lender:
1. Speed and accuracy
Richard Frunzi, president of Mortgages USA, says speed and accuracy are key. “Most major lenders take 60 to 90 days to close a mortgage. However, a lender with best-in-class service can close a mortgage in as little as three weeks.”
2. Focused on customer service
Frunzi says it’s important to find a lender with a focus on customer service “who is freely available to answer all the questions that a new buyer naturally will have.”
3. Keeps up with industry trends
Frunzi says that a mortgage lender with a focus on continuing education is a must. “A licensed loan officer who takes ongoing training is often more knowledgeable about new products and changes in the industry.”
4. Good customer reviews
It’s become fairly easy to do your own research on just about any company these days. Jeremy David Schachter, a mortgage adviser at Pinnacle Capital Mortgage, suggests checking out past clients reviews on verified sites to get a sense of a lender’s reputation in the industry.
5. Personal recommendations
While similar to customer reviews, getting a personal recommendation is even better since you know the messenger. Schachter says, “Ask for recommendations from your Realtor, friends, coworkers, and family.”
3 best mortgage lenders for first-time buyers
As the number one FHA lender in the U.S., Quicken Loans is a good place to start if you’re a first-time buyer. This lender is also the largest non-bank lender in the country and has a lot of mortgage options.
This bank also offers FHA loans, as well as other loan options with low down payments.
Customer reviews of this company highlight its excellent customer service. Veterans United is also very experienced with VA loans, which is a great option if you’re a first-time buyer with a military affiliation.
3 best mortgage lenders for poor credit
Frunzi says a customer with credit challenges should seek a lender with a suite of different mortgage products. “Banks and large institutions may only offer their own products, whereas a smaller mortgage lender may have access to a wide range of mortgage products offered through partners and investors.”
Once again, Schachter says finding a lender that is both a broker and a banker can be useful for buyers with poor credit. He also recommends “a lender that may not be a portfolio lender (keeping the loans in-house), where you could have stricter overlays or more guidelines to follow.”
Here are three to consider:
Quicken is a good lender if you have poor credit as they accept lower credit scores than many banks, especially for FHA loans.
HomeBridge is a direct lender that also accepts lower credit scores than many banks.
You can check your approval quickly a loanDepot with only a soft credit pull, meaning it won’t show up on your credit report. The company offers a wide variety of mortgage loans.
4 best mortgage lenders for refinancing
Speed is often of the essence in refinancing, since you want to lock in a good interest rate. Frunzi says, “In today’s fast-paced market, a lender that utilizes a high degree of automation and access to varied products can be advantageous in quickly closing a loan without the need for an expensive 60-day lock.”
Schachter, once again, advises finding a lender that is a broker and a banker to have a variety of potential lenders at your fingertips when seeking a refinance.
Refinancing is easier than it used to be because so many online lenders have automated certain parts of the process. Here are four lenders that have cut out the middleman and made refinancing simpler, faster and, in many cases, cheaper.
Make sure you do your homework before applying for a mortgage or refinance. Check online reviews and seek referrals from friends and family to find a lender with a proven track record of closing a mortgage without lengthy delays.
Frunzi says, “It is often the case that smaller lenders with a focus on the customer will give you the best overall experience.” Schachter emphasizes finding a lender that gets high marks on customer service, past reviews, and awards.
Whether you want to compare mortgage companies or find the best mortgage refinance lender, we’ve made it easy for you to do the proper research. You’ll be able to easily compare rates and terms side-by-side, as well as read real customer reviews.
By doing so, you can be confident that you’re making the right decision.