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Home Loan Guide

Step 4

Choosing a Lender

Buying a home is a complicated process that requires many different steps. Choosing the right lender to help you find the right financing is one of the most important steps of the process. There are a variety of lenders in the market: savings institutions (savings banks and savings and loan associations), commercial banks, mortgage companies, credit unions, and insurance companies. How to choose among all these lenders becomes an important issue. If you choose a right lender, it can save you a lot of hassle in the future. Here are some of the tips to help you choose a lender.

  1. Efficiency: Quick turnaround time is an important concern when you look for a lender. When choosing a lender, look for a renowned lender with a reputation for efficiency. Some banks or savings institutions can do the processing and underwriting of your loan right at the branches. This will save you a lot of time.
  2. Direct Lender: Many lenders in the market are not direct lenders. They have to rely on outside funding sources and do not have control over funding of your loan. This will delay your loan approval. We advise you to look for a direct lender that does not rely on outside sources for funding as well as having the control over the approval process. This will avoid last minute run arounds that would cause delay to your loan approval.
  3. Reputation: Choose a lender that has been in the lending business for a long time. It will be to your advantage as they would have more experience in loan funding.
  4. A Variety of Loan Programs: A good lender should allow you to select from a variety of loan programs with different terms, interest rates, and options that best fit your needs. Some lenders even offer no income verification loan programs for those who cannot provide proof of income.
  5. Quality and Professional Service: Finally, if you find a lender with the criteria listed above, you should also consider if you are comfortable with the loan officer who serves you. It is important for you to feel comfortable with the loan officer on his or her professionalism as he or she will have a significant impact on the loan process.