3 Golden Rules for Choosing the Ideal Mortgage Lender
Choosing a mortgage lender to service your home loan is not unlike choosing your realtor, your insurance agent, your financial advisor, your doctor, your lawyer, or even your spouse!
Largely in lending, it’s about building a relationship centered on trust – and determining if that person IS the person you want wading through the complex story of your finances.
Aside from considering the relationship with your loan officer, it’s also important to consider the finer details of the loan. Data points like mortgage rate, annual percentage rate, discount points, and other fees ensure that the deal you’re making remains static and predictable over the loan’s term. You don’t want any costly surprises when it’s time to make payments.
Here are your keys for making a smart, educated choice when it comes to choosing a mortgage lender.
Thinking about starting the process of looking at homes? Before you find the perfect home, your first step should be to get pre-qualified. Learn why you should do this sooner rather than later.
Compare Rates and Data Points from Multiple Lenders
When you’ve found the house, it’s time to get moving to secure your loan.
As you shop lenders, keep in mind that there’s more involved in making your choice than simply comparing mortgage rates. Going over data points such as annual percentage rate, discount points, private mortgage insurance (if you’re required to pay it), origination fees, and others all contribute to the total cost of the loan.
Make a blunder overlooking one figure and you might end up adding more to the balance of your mortgage than you’re comfortable with.
As you evaluate loan programs, consider the below data points and how they compare across lenders for a true picture of your total cost of homeownership.
Crunching numbers? Use our mortgage calculators!
- Mortgage Interest Rate: The mortgage interest rate is the interest a lender charges to lend you money to purchase a home. This figure is a percentage of your total loan balance and it’s paid on a monthly basis, along with your principal payment, until the loan is paid off. Different lenders have different rates tied to various loan terms and you can compare rates daily as you shop.
- Annual Percentage Rate: This rate reflects your true cost of borrowing and figures in the mortgage interest rate, discount points, and fees charged by the lender. Using the APR figure, you can compare different types of mortgages based on the annual cost of the loan.
- Discount Points: Mortgage points, or discount points, are extra fees paid to your lender at closing in exchange for a reduced interest rate. This is also known as “buying down the rate” and it can lower your monthly mortgage payment. One point usually costs 1% of your mortgage amount, or $1,000 for every $100,000
- PMI: Do you plan to put down less than 20% for your down payment? If so, lenders require you to pay a monthly fee along with your mortgage payment called Private Mortgage Insurance, or PMI. PMI can cost between 0.5% and 1% of the entire mortgage loan amount annually.
- Mortgage Origination Fee: An origination fee is an upfront fee charged by your lender to process a new loan.
Work with a Loan Officer You Trust
Nearly as important as comparing the data, it’s important to choose a loan officer you feel comfortable with sharing your personal information with. You can devise a short list of lenders and potential loan officers by asking for a recommendation from within your trusted circles, getting feedback from your realtor, and combing over online reviews.
You can also just pick up the phone and call a few. Talk with them candidly about your needs and how they can help support your goals as a homeowner ..
Consider things like ease of communication, the rapport you have with them (or not), how quickly they respond to messages and in what manner (phone call, email, text), and how they help educate you on your loan options and the various fees that apply.
Most of all, consider if they’re someone you can trust moving forward through one of the biggest transactions you’ll make in your life.
We Make It Easy to Compare the Data
At Gulf Coast Bank Home Loans, we help you compare loan programs, rates, terms, and fees with other programs with just one call to your local loan officer.
We help you by:
- Answering all of your frequently asked questions about our loan programs
- Showing you how our rates and fees compare to competitors
- Offering mortgage calculators that provide a clearer picture of your cost of your monthly payment, PMI, APR, and discount point reduction
- Offering you a full range of loan products, educating you on your options, and helping you choose the program that will work best for your finances
- Getting you pre-qualified so you’re ready when it’s time to put in an offer on a home.
Our goal - helping you easily and quickly get pre-qualified for a home loan!
Make the Choice in Gulf Coast Bank Home Loans
Have you found the house or investment opportunity and you’re ready to take the mortgage plunge? We can help educate you and even compare our rates and fees to those of other lenders.
Find a loan officer near you today and reach out. We have a network of dedicated loan officers across 19 branches located throughout the Gulf Coast region in South Louisiana, Texas and Florida.