I’m a student of the mortgage industry — I read everything I can on the business, whether it’s written for consumers or for industry professionals, and especially if it includes information pertaining to or coming from the CFPB. For those of you who don’t know, the Consumer Financial Protection Bureau is a regulatory authority that was formed four years ago. It oversees consumer financial products and the organizations that provide them. To learn more about the CFPB and their mission, visit www.cfpb.gov.
I’m always surprised and disappointed when guides to finding a suitable lender are published and focus primarily on rates, points and fees. A home purchase is generally the largest financial transaction in which most consumers will ever engage. I appreciate that cost and fees are a large factor when shopping for a mortgage, but there are many other factors to consider when selecting a lender.
“The bitterness of poor quality remains long after the sweetness of low price is forgotten.” — Benjamin Franklin
In addition to costs, what else should real estate professionals and consumers be seeking from a loan officer/lender?
- Do they have a signature line in their email that includes their contact information and their mortgage licensing information? This is required by law.
- Is their written communication well-produced, utilizing proper language, punctuation? Is it professionally formatted? Does the communication make sense? Is it helpful?
- Did the lender offer or prepare any written details pertaining to the loan, like a spreadsheet or preliminary estimate of costs and fees, and a loan product comparison?
- Did the lender explain how a rate lock works?
- Was your initial call or email returned promptly?
- Is the lender available to work with you when you’re available?
- When they offer a pre-approval or pre-qualification, do they require that the consumer submit all pertinent financial documents to review before issuing a letter?
- Are they fast to respond when needed?
- Do they have a team backing them up?
- Do they offer to talk with the seller or listing agent about a specific borrower/offer?
This list could go on forever — mortgage financing is complicated, and it requires the services of a confident and experienced professional to guide the consumer and agent through to the closing. Of course, no matter who you call, you’ll always be able to find someone willing to do the job for less, but making a large financial decision based exclusively on price can lead to a stressful and unhappy experience. Be sure to shop for quality service too, so that your real estate closing will be a celebration instead of an aggravation!