Whether you’re a first-time or experienced homebuyer, finding a mortgage lender can be time-consuming and stressful. A home is a long-term commitment, and a mortgage may take upwards of 20 years to repay. Like buying a car or an insurance policy, it’s important to consider all options. In this guide, we offer a few useful tips on finding the right mortgage lender.
Know Your Credit History and Boost Your Score
When applying for a home loan, lenders look at credit scores and financial histories. A substandard payment history and a low score will significantly affect the mortgage rate you receive. However, those with good credit have a better chance of negotiating a great rate. You can visit Fellowship Home Loans to learn more about our lending criteria, and you should also:
- Check your credit report to ensure that it’s accurate. The three major credit bureaus—Experian, Equifax, and TransUnion—all give reliable information.
- Get your finances in order by paying off high-interest debt and lowering your debt-to-income ratio.
With these easy tips, you’ll be able to devote more money toward a mortgage—and less toward debt.
Compare and Contrast Mortgage Lending Options
Next, check out the lender you’re considering. Is it a large company or a small one? For an individualized customer experience, a small lender like Fellowship Home Loans is a great choice. However, it’s important to do some research before deciding—compare rates from various companies and ask for recommendations. Check each company’s website and read past clients’ reviews.
Look for a Lender Offering Government-Backed Home Loans
Government agencies such as the U.S. Department of Agriculture, the Department of Veterans’ Affairs, and the Federal Housing Administration typically have flexible down payment, credit, and income requirements. This makes the qualification and application processes that much easier. There’s an upper limit, however, to the amount of money you can potentially borrow, and you’ll likely need mortgage insurance.
Consult a Real Estate Agent
A reliable and honest real estate agent won’t limit their recommendations to affiliated lenders. Let the potential lender know that you came to them via an agent’s recommendation; most loan officers take better care of those clients, and these connections may work to lower closing costs.
Get Pre-Approved for Financing
Getting a mortgage pre-approval means that lenders are willing to take your application and can likely offer the home loan you need. With a pre-approval, you’ll have an idea of the monthly payment and interest rate on the loan.
If you’re facing barriers such as a low credit score or inconsistent income, ask lenders for guidance before applying. Most lenders will work around such issues. As you’re going through a list of lenders and narrowing the field, look for a mortgage lender that’s caring, capable, and competent. The team at Fellowship has all these qualities, and many more.
Finding the right mortgage lender can be a long and complicated process, and there are numerous factors to consider when making that decision. It’s a lasting commitment, and it’s one that should not be made lightly. By following the tips in this guide, you are more likely to end up with a great lender and favorable loan terms. Request additional information online or call today to get started on the loan pre-approval process.