Prepare yourself when evaluating lender options by knowing what to ask a mortgage lender, and how their answers should shape your decision on which lender is best for you.
Access the most important questions to ask a mortgage lender—the answers they provide will reveal if they’re a good fit for your home loan or refinance.
What are the Key Questions I Should Ask a Lender and Why?
Answer: Aside from the more obvious questions like “how much do I qualify for?” there is a series of crucial questions that you should be asking a lender. These questions will help to flush out possible hidden costs, or even out-right mortgage scams:
Are your loan officers licensed and experienced?
Your mortgage banker will be the most instrumental part of knowing exactly what your options are based on your personal qualifications and on underwriting guidelines. This may go without saying, but if you haven’t been through the mortgage process as a borrower at least once in your life, then how can you possibly guide others through it? And if you cannot obtain a license then you are probably not as capable as those who have one. If you hire a lawyer or doctor you want them to be licensed and experienced – this same standard should apply to your personal mortgage banker who you are entrusting with all of your personal financial information.
Do you have your own appraisal panel or do you subcontract your appraiser management out to a vendor?
Many of the complaints against lenders found online center around faulty appraisals. Some lenders contract their appraiser management to vendors known as AMCs (appraisal management companies). Consequently, the lender has very little oversight with their appraisers and this can lead to appraisals being completed by appraisers who are not local and/or to appraisers rendering faulty low values because they have little accountability. Remember that if your appraised value comes in artificially low you will either have to bring the amount of the shortage to closing OR your interest rate will likely go up (since your value is a factor of your interest rate).
Will you guarantee that I will close my home purchase on time?
Believe it or not the law allows lenders to change most of your closing cost at any time prior to your closing! Protect yourself by asking the lender for a written guaranty that your closing cost will not go up after you apply and before you close. This may not be easy to get from some of the larger institutional lenders but do not take “no” for an answer—OR choose another lender who will make this commitment to you.
Can I get a written rate lock agreement?
Again, it seems elementary but most lenders will not provide you with a written lock agreement unless you request one. Even then some lenders do not provide them at all. A written lock agreement will not only contain the locked rate and rate lock expiration date but should also state whether or not you are paying points for the lock rate. Clearly a document worth having!
Signs of a Good Mortgage Lender
Mortgage Lender Asks Questions and Listens
The home loan process should feel very personalized to your needs, and that starts off by working with a lender who is passionate about finding the best loan option and rate for your situation and budget. Look for a lender who asks questions regarding details of your financial history regarding credit score, previous homeownership experiences, the type of home you wish to purchase, and your future plans in your next home (how long you hope to live in it, if renovations will occur, etc.). Once they get the information from you, a good lender will sort through the best mortgage options, and be able to explain why their selection makes sense for you.
Mortgage Lender Communicates Well
A good mortgage lender takes initiative when it comes to communication. Even once the mortgage process is already underway, your mortgage lender should always be in touch when it comes to any updates or simply reaching out to ask if you have any new questions. Additionally, a good mortgage lender will be sure to explain any home loan and mortgage lingo that their customers may not know off-hand. Good mortgage lenders don’t just value mortgage leads, they value their current customer’s mortgage experience.
Mortgage Lender Makes Good on Home Loan Closing Timeline
Hiccups and unexpected hurdles are a reality when it comes to closing your home loan on time. But a good mortgage lender should be prepared for unexpected issues to arise, and have the knowledge to handle them as efficiently as possible. We know that failing to close a home loan on time can cause more expenses to pile up for the borrower—so whether that means coming up with an alternative to your original home loan plan, or making sure all paperwork is submitted properly, Homesite Mortgage has the experience and know-how to ensure you close on time.
Why Customers Love Homesite Mortgage
At Homesite Mortgage, we know that working with a trustworthy lender is one of the most important priorities for our clients. Our company is structured to give you the personal attention of a small business, but the vast loan options of a large lender. Take a look at what previous clients have said about their home loan experience with Homesite Mortgage.
Have a Question or Want to Talk about Locking in the Lowest Home Interest Rate?