How to Choose a Mortgage Lender: Four Things to Consider
It has been a strong summer for the housing market and with rates recently dropping to the lowest for the year, prospects continue to look bright. According to Freddie Mac, a 30-year loan is now set at 4.12%. This is great news for those considering the purchase of their first home. “Low mortgage rates and home prices that are climbing more slowly should boost the housing market”, said Keith Gumbinger, spokesman for HSH.com, a mortgage information company.
Interestingly, rates have fallen even though the Fed has been trimming its monthly bond purchases, which are intended to keep long-term borrowing rates low. The purchases however are set to end in October, so for those seeking a mortgage for a new home, now is a good time to act.
Buying a home is undoubtedly the most important purchase decision that you will ever make. This makes the choice of an appropriate mortgage lender especially vital when considering the purchase of your home. The lender of your choice will be intimately involved with you for an extended period of time, so it's very important to find a company that you can be confident of, and one that you feel is really committed to helping you realize your financial goals. Two such companies immediately come to mind. They are both mortgage lending institutions that are able to provide the borrower with a loan product that best suits the particular needs of the client. One company, TexasLending.com, has been receiving the Consumers' Choice Award for eight years running. The other lending institution of merit is American Equity Mortgage, in Atlanta, Georgia. This company has been a Consumers' Choice Award winner for twelve consecutive years. These two companies have a flawless track record, so it would be advantageous to start your search with the aforementioned companies that come highly endorsed. The first-time home buyer can certainly feel somewhat exasperated and unsure about how to proceed with such an important decision. Knowing how to choose a mortgage lender is in your best interest.
The following pointers should be carefully considered:
- Customer Service Is the customer service agent readily accessible when you have an important matter to verify? Is the info that is provided, clear and concise? Does the institution promptly address your questions and concerns in a satisfactory manner? Do you feel that the service provided is delivered with you in mind? After all, the company you choose will be with you for a long time.
- Product Availability Carefully take into consideration various fees and lending terms which can vary from one lending institution to the other. Make certain to take your time to prepare adequately before you select the lending institution. An experienced and reputable lender will be able to clarify for you what best suits your individual financial needs.
- APR The APR (annual percentage rate) is an important gauge to consider when you compare the varying offers among lenders who make use of different loan terminology. "It's the one common denominator by which you can compare loans side by side, comparing apples to apples to apples," says David Newton, economics professor at Westmont College. There are many important items to consider, since the lowest APR isn’t always the best indicator of the overall affordability of the loan, as there are other details that must be factored into the total cost of the loan package.
- Reputation A well-known large institution is not necessarily the superior lender. Smaller companies can provide you with personalized service that the bigger institutions are hard pressed to provide. It’s very important to verify the track record of any company before you make your choice. A word-of-mouth recommendation is always commendable. Consumers’ Choice Award highly endorses the two lending companies mentioned above.