BROKER or LENDER

The housing industry is a huge business.  There are a variety of people and companies involved - from buying to selling, to photography to inspections, but most one of the most important pieces for a buyer when it comes to being able to purchase their home is the funding.  There are big banks and local banks, online only banks, mortgage companies, and even lenders that specialize in certain types of mortgages like VA or FHA.  There are also companies and individuals who are Mortgage Brokers.  Their business and livelihood is 100% focused on mortgages.  They act as a personal shopper for their borrowers, searching their portfolio of mortgage lenders to find the best deals available. 

Start by deciding what you would like your purchasing process to be like and then do a little research to find a lender (or two) who compliments your personality and purchasing scenario.  Do you want to be another number or do you want a personal experience?  Do you want someone who can answer a lot of questions or do you know exactly what loan you would like and just want the fastest cheapest option?  Do you want someone who knows the local real estate market and neighborhoods?  Or perhaps someone from a nationwide company?  It may help to talk to friends, neighbors or colleagues who had a good experience.  Read reviews.  This is an important decision... your lender or broker is who you will rely on to show you the best options for your purchasing situation.  A difference of 1%  in an interest rate will cost you for the next 30 years.  Last minute or surprise fees can alter how much cash you need to bring to the table.  Find someone you believe is knowlegable, experienced and trustworthy to act as your partner throughout this process. 

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You are allowed and able to shop around for a lender.  Lenders know this is a part of the process and some may even compete for your business.  Don't forget - most things that sound too good to be true, probably are.  "No closing costs", likely means a higher interest rate.  If one fee is "waived" another may be increased.  Interest Rates can be bought down, but they also fluctuate daily, similar to the stock market.  Comparing loans and fees can get confusing.  What can help, is that lenders are required to show the "APR" for the rate, which is the interest rate once all the fees are included.  This makes it a little easier to compare two loans, but having a broker or lender you trust is important.  Once your offer is accepted and you have a bilateral contract you will have a few days to choose your lender and finalize your funding.