Buying a home is a major decision, no matter if it is your starter home or your forever home. Just as important is finding a lender who can answer all of your mortgage questions and provide you with the right loan for your unique situation.
Today, you can find mortgage products offered by local lenders, banks and other types of mortgage providers, some of them with regional or national reach. Even so, choosing a local lender may be the right answer. Local lenders tend to offer better rates, more personalized service and a commitment to support their communities.
Here is information about home loan lenders and the benefits of choosing a local lender as your trusted partner for your home purchase.
Are All Lenders TheSame?
The short answer is no. Mortgage providers may offer comparable products that will let you buy a home, but the similarities end there. Each lender has its own way of doing business. They will differ on loan approval processes, lending requirements, loan costs andmore.
Also, lenders will vary on the type of services offered. Some may offer in-person assistance at a branch or office while others operate solely online, according to Investopedia.com. Getting pre-approved for a home loan will vary by lender,too.
Here are the different types of lenders for homeloans.
- Mortgage Lenders: Lenders who only offer mortgages often operate online and don’t have a physical office where you can conduct business face-to-face. Contact is usually made via phone or email. The application process is done online, which may make it more difficult for the homebuyer, especially if they are not tech-savvy. Once the loan is funded, the loan servicing is managed entirelyonline.
Examples of an online mortgage lender would be Rocket Mortgage or Better Mortgage. Both specialize in home loans and offer a variety of loan options. Also, they tend to be more lenient with credit limits and offer streamlined services for quicker loan processing, according to Bankrate.com.
Some concerns about these types of lenders are that they do not offer other financial services, are less regulated than credit unions and banks, and may only be reached by phone or email. Also, they may sell their loans to third-party investors, causing your loan to be serviced by someone else, says Rocket Mortgage.
- Traditional Banks: Traditional banks also offer mortgage products, but they may cost the homebuyer more. According to Bankrate, banks may have higher fees associated with strict federal regulations. Also, there could be longer underwriting times, as well as a possibility that your mortgage may be sold off to a third-party company for servicing, says Bankrate.com.
There are some benefits of getting a home loan with a bank. Existing customers may be offered a good deal. Plus, customers can visit a bank branch in person to discuss mortgage options.
- Local Lenders: A third option for getting a home loan is to explore local lenders, especially if you are looking for in-person interaction with a representative who can walk you through the steps of buying a home. Local lenders such as credit unions focus on member service by building a relationship with you first and then working to find the best solution for your home loan search.
The benefits of selecting a local lender are many. After you apply, the loan underwriting tends to be a lot quicker. That is because they have a deep understanding of the markets they serve and use this information to help you. Plus, local lenders tend to offer better rates as well as other types of financial services. This lets you do more of your banking at oneplace.
Go with the Local Lender
Understanding what your needs are when buying or refinancing a home can help you determine what type of lender to select. Some areas may not have local lenders, but many do. Going with one means that you will be bringing your business to a company that knows the market area very well and understands everything it takes to complete your home loan quickly and correctly.
For example, Travis Credit Union processes your loan entirely in-house, which results in faster loan approval. Plus, you’ll always have TCU as your mortgage lender, giving you peace of mind that your mortgage remains with the credit union for the life oftheloan.
Also, some local lenders may offer first-time homebuyer workshops or information that can teach you about the home-buying process and prepare you to become a homeowner. They may also have business relationships with local Realtors to make it easier to close on a home faster, according to California.com.
Select TCU as Your LocalLender
Travis Credit Union has been rooted in the community since 1951. Itsmission is to help members achieve their financial goals, which may include buying a home. TCU’s home loan products are processed entirely in-house, and they service their home loans for the life of the mortgage, so you are always dealing with them and not a third-party. Visit the TCU Mortgage Hub to learnmore.
Along with home loans, TCU offers an array of financial products and services to help people improve their financial wellness. Their free financial workshops let you learn more about buying a home or car, building credit and so much more. Getstarted today at traviscu.org.
Mortgage Hub
