Monday, December 6, 2010

Choosing a Lender for Financing

Today my post will be short and sweet.  Financing has become a nightmare.  The very ones who got us in this mess are now making it nearly impossible for people to get financing.  I recently closed a loan that should have closed two months ago.  It was truly by the grace of God that the buyer hung in there.

So how should you choose a lender?  Well first of all, avoid mortgage brokers if you can.  In the days of glory, brokers were the better option because they could shop your loan and get you the best rate and terms.  However, now brokers are stuck having to kowtow to the "investor" or the real lender.  And the borrower is suffering from it because they are having to pay two set of fees and are experiencing delays.

Second, direct lenders have more latitude and actually have more products to offer.  Think about one of the big ones like Wells Fargo.  If they can make a lot of loans which makes them a lot of money, then they can offer more competitive terms to the next borrower.  And since the money is coming directly from them, many of the hassles have been eliminated.

So in this current market, I would definitely suggest that you choose a direct lender as opposed to a mortgage broker.

Also, if you are in the market to purchase and need assistance, there are still a good number of down payment assistance out there.  Contact me for more information.

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