Should You Trust an Online Mortgage Lender?
Should you trust an online mortgage lender to help you finance your home?
Look. I get it. You probably went to Lending Tree or Bank Rate to find out what the lowest rates were, and now you had to turn your phone into the witness protection program to get the calls and texts to stop.
I'm sorry. I too have made that mistake.
But now you are getting hit by every lender in the book. Rocket, Guaranteed Rate, First Eagle American Funding Mortgage Leader Bank, etc.…
But maybe it’s worth the cost to get the lowest rate. But can you trust them?
You saw the rate listed on the website, and it’s much lower than what your local bank had mentioned.
Yes. But we need to define trust. Can they really lend you money and it work out?
Yes. The mortgage industry is a highly regulated industry. If you’ve heard from a licensed loan originator with a licensed company, yes, you can trust them to finance your home.
But if by “trust” you mean “will I close on time?” or “will I get the best loan set up for my situation?” etc., then usually, no.
Choosing a mortgage lender is more than just the sticker price. The rate is very important, obviously. But you need to think about other things that are just as important or more important. Three important factors are these:
Closing on time. If you are refinancing, this isn’t as important (though it does matter… your loan is only locked for so long so if they aren’t organized, they could force you into needing to pay for a lock extension, which then will eat away any savings you thought you had by going with them). If you are purchasing a home, your seller will only wait so long for you to need contract extensions, which are a headache in themselves. And what of the moving trucks with all of your stuff, sitting there, waiting? Simply put, closing on time is crucial.
Loan strategy. Financing a home isn’t a matter of just picking a rate. It includes a host of other factors. You want someone equipped to educate you and empower you to leverage your home for your family and your future needs. A mortgage can set up your family for future success if appropriately structured.
Character. Maybe you can get by without this, but without someone of integrity caring for you, I’d fear that I had been given a loan that didn’t really benefit me and fit my needs.
Now, in full transparency, I found my last mortgage loan through Bank Rate and went with some random lender in Florida I didn’t know. But I'm a licensed originator, so I know that I can make sure my loan closes in spite of incompetence. I also know how to structure my loan to best benefit me and my family.
But remember that there is real value in seeing and knowing the person who is caring for this transaction.
I know you want to do everything online! You’re a millenial. You’re Gen Z. Don’t call me. Don’t talk to me. But everyone has the capability to do things online. So, find a lender that you can trust and has the experience and expertise to help your situation.
Note: This is a summary from my latest YouTube video on this topic, which you can find below. I’ll oftentimes write up summaries of them here for those that prefer short and sweet a few days or weeks after the video releases. Subscribe and share!