As the year 2014 winds down, I asked myself, “what is a challenge we faced on a regular basis that we will continue to face in the upcoming year?” As I reflected, the answer was clear to me. It is the challenge we face as a FDIC insured Bank that lends on a national platform competing with the “local” lender. In today’s modern technological time, you would think that everyone would understand that just because your “mortgage” person is not sitting in an office down the street from you that it doesn’t matter but it does. Many times this is because consumers are misinformed about Lenders who lend on national platforms and offer the ability to apply online.
As the years have gone by and you get the same reasons over and over about wanting to use the “local” lender and the number 1 reason is always because they are down the street. What people fail to recognize that is their busy lives don’t allow for them to just drive down the street and do the mortgage application or pre-approval in most cases. Between your hectic work schedule and the local lender’s work hours you will find it very hard to make this happen So what happens next, you end up doing everything by phone, fax and scan just as if you were using the online lender.
Another challenge faced is the assumption of the local lender knows the market and area better therefore they will have a better understanding of value and housing in the area. I attest this to improper education of most home buyers. When you are buying a home or refinancing, in almost all cases an appraisal is required. There is very limited circumstances when an appraisal is not required. What this means, is regardless of whether its the local lender or online lender, the appraisal is ordered through a 3rd part vendor typically called an AMC or VMC, who in turns contracts an appraiser in the local market to perform the appraisal. The collateral and its value is the most important factor in determining a loan and outside of this one report, every part of the mortgage process is basically uniformed regardless of who does the loan. So my point, the one thing that can affect a loan and requires an expert in determining the market, the uniqueness, and the value is done by a local person who works in that specific market.
One other item that is not mentioned very often is for people who have credit ratings below 700. Many times you may have been turned down by your local lender and feel your credit is not worthy of a mortgage transaction. That is typically not the case. Online national lenders typically sell to many investors and offer an array of products for people who feel their credit is challenged. In most cases if credit is reasonable, they will be able to find a product that suits your needs.
Lastly I would like to leave you all with my final thought. As I mentioned in my last post. Regardless of whom you choose, communication and trust is key. It does not matter who you choose, if you do not feel you are getting proper service, then you may have chosen the wrong lender for you. Whoever it is, make sure you have their contact information, make sure they respond to you. Remember, if you are always having to call them, then you may need to find someone else. Ask for references, we love to give them out.
Also would like to wish everyone a safe and Happy New Year!
If interested in mortgage services or general mortgage questions email me at themortgageminded@gmail.com
Mortgage Mind 