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Where is the best place to go to get a home loan? The answer is it depends upon your own situation. I’ll discuss 4 sources and their merits
and faults. After you understand what the sources are you can make a better decision about what is best for you. At that point it is good to ask
friends, family, people who work with you, and yes even your agent. Agents are in a difficult position when it comes to making recommendations. They
really want to tell their clients, “This is who you should go to”. But the real estate commission advises against this. It can
The fours sources are (1) banks, thrifts, and credit unions, (2) Mortgage Banks, (3) Mortgage Brokers, and (4) Internet lenders. Banks, thrifts, and credit unions are institutions we deal with on a regular basis and for that reason there is a trust factor. If you have good credit and a appropriate down payment this can be a good place to go. Their main limitation is what they have to offer. They often have fewer resources for getting the money you need and they are less likely to be able to help you if there are any limiting conditions. If you go this route you should call several to compare prices. As with other institutions each has it’s own regulations and sometimes it is difficult to make accurate comparisons. Most banks offer only one or two programs so choices are limited. |
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lead to some legal
complications.Mortgage Banks – Mortgage Banks are great for people with good credit, but if yours is not ranked highly it may be difficult for you to get a good loan here. ( See section of finance page on ratings ) Remember that the better your credit and the more down payment the better your rates and bargaining position. Mortgage banks are strongly regulated and you can usually deal easily with them. They usually can get a loan quickly if you qualify. As with banks it is best to check several mortgage banks for best rates and lowest costs.
Mortgage Broker – Is the one stop loan shop (are you impressed with my poetry ability – ok, no one else is either). They represent many different lending companies. They have the flexibility of finding a fit for your needs. If you have credit problems they are more likely to be able to find a lender who (at a cost) will meet your needs. Those having good credit will have someone do the leg work for you in finding the best loan. Mortgage brokers are not as regulated as Banks and some of the more “questionable” brokers can add hidden charges. If you find a good one that you are comfortable with it can save you some time and money. In theory they get their money from the lending institutions you borrow from.
Internet lenders – are for people who are loan knowledgeable and comfortable in the computer world. You don’t have the comfort of knowing who you are dealing with but can find some good deals. I have heard some negative stories about internet loans, but if you do your homework and read the box below you may do fine.
 | My suggestion is that before dealing with anyone check with the Better Business Bureau. In Lexington and Central Kentucky the number is (859) 259-1008. The local web address is: www.lexington.bbb.org. The national website is: WWW.bbb.org/ |