Choosing the Right Lender
If you’re financing your property purchase, having the right lender on board is critical- 90% of the problems that occur and potentially threaten a transaction have to do with the loan.
Is an Online or Live Lender Better? While online lenders are getting better and usually promise to make the process smoother and easier, let’s be sure they’re right for the job. Taking the risk with an unknown player who may not be able to close on time or deliver your promised terms, can be fatal to the transaction, which can end in costly ramifications for you.
What’s Important to You? We all know finding the best interest rate, lowest loan costs, and manageable monthly payments are important, but be sure to check out the loan officer’s experience, their on-time track record, performance times and their level of investment in your success. The lender is the front line soldier for you getting the loan, and we need to know they’ll fight tooth and nail for you.
You want a lender who is an asset to you and your offer, not a question mark.
Look at it from the seller’s perspective: how does your lender stack up with the other offers, and what does a seller want if they chose your offer?
Is your lender a known entity?
Is your lender familiar with the local market?
Are your lender’s performance benchmarks competitive?
Does your lender have a good track record of successful closings?
What will your lender tell them about your financial capacity?
Is your lender invested in the success of this transaction?
Different buyers and different properties may need different loan products: not every buyer needs a 30 year fixed loan, and not all properties require one, either. Mortgage brokers, Investment brokers, Direct Lenders, 30-year, fixed rates, adjustable rates- it’s great to have options, but which options are best for your situation…that’s right, talk to me first, and I’ll get you pointed in the right direction.
Submit a Loan Application and Get Pre-Approved (It’s a Must Have)
The lender you choose will ask for your important financial documents. Let’s get them in order as the first step. This application file includes recent copies of your:
last two years of tax returns
leases or rental, or other property investments
stocks, bonds, 401k statements
With Pre-Approval Comes a Price Range: once you have pre-approval from the lender, you’ll know the price point to shop from and your monthly costs. This range will help focus our search, so we’re looking at the right places to purchase.
Underwriting and Loan Approval: only after you have your offer accepted on your dream home (during escrow), is your application fully underwritten by the bank. Approval (or not) comes only days before you close. There are certain do’s and don’ts you should adhere to during this process- no big purchases, don’t pay off cards or move money, and don’t quit your job! We’ll talk about this well in advance.