Can/should I work with multiple lenders?

Question

Hi all, my business partner and I are aiming to purchase our first LTR property. We have our agent and lawyer selected but are between two different lenders. Both fantastic in their own rights and I am wondering if it is possible/is it advisable to work with multiple lenders? What are the impacts of trying to do both? Appreciate your advice!

Mark Munson · Answer

Hey @Conor Neville

.     It never hurts to have more than one lender in your stable. The reality is that most can't fund every deal or may have an underwriting guideline that doesn't suit your deal. Prioritize the lender that communicates well and actually answers your questions correctly and in a timely manner. Chasing the lowest rate/fees doesn't always yield the best result. You want a rep that can talk actually real estate investing with you, not just someone there to hand you rates and terms. They should also be well versed in underwriting, not just being a loan officer.

Zach Schaphorst · Answer

The best time to decide on which lender to work with is after you're under contract and have the opportunity to lock in your interest rate. Until you have a locked loan estimate from both lenders you don't know what they're really offering. But while rate is important, if there's one lender who is dramatically more responsive and seems more knowledgable than the other I'd probably go with them even if their rate is slightly higher for your first deal.

Eric Williams · Answer

Use the one that has the better rates, terms, service for your particular deal.  You can always refinance down the road or try a different lender on the next one.  You will inevitably use multiple lenders throughout your investing journey.  I have one I love here in Texas but they don't lend outside of Texas and don't lend on land or commercial properties so I have to use different lenders.

Do your due diligence but also don't stress out too much about it.  If the rate and terms offered give you the returns you need then it will be fine.

Brandon Croucier · Answer

I do not work with clients openly working with other lenders as I value my time and would rather spend it with a serious client.

Erik Estrada · Answer

Yes you can work with multiple lenders, but they may not take you as a serious client. We all understand you want to save on fees and have the lowest rate. But there comes a point where it just does not make sense to even do the loan and it becomes a game of who will do it for the cheapest.

If you are working with a solid mortgage pro, they will definitely not play that game and would rather work with someone more serious. So you will end up with a rookie that will do it for cheap and cause you to lose your EMD or a discount shop that will barely answer your phone call.

If you are okay with having a horrible experience and possibly closing, go with the cheapest. Also be careful about any bait and switch. This is more common on the commercial/private money side since there are no regulations.

Can/should I work with multiple lenders?

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