How to vet Lenders

[Erik Estrada]

I think I have came across thousands of posts here on BP of some lending scam or a broker being dishonest about fees. As a broker myself, I wanted to share my 2 cents on how I vet new lenders. 

1. Check reviews and read them. A good review will be very thorough..

2. Ask about their process.. The best originators will be able to walk you through to get to closing, without many surprises.. 

3. Ask other people/other investors. Easiest way to find out if someone will waste your time or not. 

4. Ask for guidelines/rate sheet. Instead of relying on someone's word, have something written that you can refer back to. 

5. Check for licensing. Even though some states do not require a license to do business purpose loans, SOMETHING is always better than nothing at all. 

6.  Ask about how they handle mistakes. They happen, but the best originators, will always put their client first, commission last. 

[James Butler]

As a previous underwriter helping build a lender in a new market I completely agree. Understanding the process and different components is key. The good ones will have title recommendations, will be transparent about fees, and request a complete file and exit strategy. Stories have to make sense both on the lending and investing side.