Unless you are very wealthy or just sold a house for more than what you will be paying for the new place, odds are good you will need a loan to purchase your home. A loan to purchase a property is called a mortgage. There are three basic types of mortgage lenders. Before signing any paperwork, take some time to consider each type and determine which one fits your situation best.
If you have a good relationship with your bank, you should consider applying for a mortgage with them. This will keep all your financial dealings in one place. Of course, it is not necessary to have a relationship with the bank to apply for a mortgage. However, banks tend to comply with regulations according to certain loan programs. If you do not qualify for these programs, you may not be approved for the mortgage. In addition, because of all the program requirements and the fact that banks handle many different types of financial dealings, it may take a while before you find out if you are approved or not.
Credit unions may not use the different federally backed programs a bank does. However, they often have lower interest rates and fewer fees associated with the mortgage process. It also may take a while for the approval process. In most cases, you must have an established relationship with the institution to get a mortgage through a credit union.
A mortgage company does nothing but process mortgages. This means the process goes through more quickly. In addition, they do not offer all the different federal programs, so they can be a bit more open with the plans they do offer. Everything is done within the company.
It is also possible for a mortgage company to sell the mortgage to another company, meaning you may end up dealing with a different entity entirely. However, the terms and conditions of the original mortgage will stay the same as they are legally binding regardless of who owns the loan.
Talk with your real estate agent about the different mortgage lenders. Then, talk with each different lender. A mortgage is a big deal and will not be done and over with for many years. You should find the mortgage company you are most comfortable with that will give you the best deal for your situation.
Contact a local mortgage company, such as Pacific Mortgage Group, to learn more.Share