Are all FHA Lenders the same?

Question

Hi BP Community... I am looking for an FHA lender for a triplex purchase.  I've read up on FHA requirements but haven't been able to find any tips about FHA lenders.  Are all FHA lenders the same?  What should I be aware of when considering FHA lenders?  Thank you.

Russell Brazil · Answer

No. Every lender is different. I always suggest people get a referral to a lender (and really all professionals). Most people think they will be smart and shop around for the best rate or lowest fees, and dont understand that literally the rate changes with the bond market, so calling a couple different lenders hours apart can result in two different rates. Also some lenders will quote the fees purposefully low to get you in, then the fees rise through out the transaction. Some lenders purposefully quote the fees high, so then they look like a rock star when the fees drop through the process.

A good agent if you have one, should be able to explain to you the pluses and minuses of different lenders in your area. In a competitive market, the most important thing for a lender is the ability to close the loan and lose it on time.

A good agent if you have one, should be able to explain to you the pluses and minuses of different lenders in your area.  In a competitive market, the most important thing for a lender is the ability to close the loan and lose it on time.

Jeff Copeland · Answer

Keep in mind, there are mortgage brokers (who shop around for someone to loan you money), and direct mortgage lenders (who loan you their own money, more or less) - these are obviously oversimplifications. There can be advantages and disadvantages to each.

Happy customers who met the closing date in their contract is a key metric from my perspective.

CJ Lee · Answer

@Jeff Copeland @Chris Mason Thanks for your advice.  I guess my question should really be, "Are all lenders the same?"  Outside of personal referrals, what would be a good starting point in finding a reliable and trustworthy lender?  What questions should a borrower ask when interviewing lenders?

Jeff Copeland · Answer

Like all service providers, lenders vary widely in their areas of expertise, geographic focus, professionalism, responsiveness, etc.

Most mortgage lenders/brokers offer FHA-backed loan products (in addition to conventional, VA, and other loan products), so you don't really need to look for an "FHA Lender".

Just shop around for a trusted lender (based on personal referrals, reviews, etc), then ask them about the right loan product for you (which may very well be FHA, but there are some good alternatives as well).

Zack Karp · Answer

Hi @CJ Lee,

No, lenders are not all the same.  Especially for FHA.  Every lender has different overlays on top of the FHA guidelines, a different loan officer experience, a different processing experience, a different underwriting experience, different interest rates, different costs, etc.

PM me if you want an intro to an awesome lender in CA, I have a few Loan Officer colleagues there that I highly recommend.

Chris Mason · Answer

Agreed, there are some great FTHB programs out there that are not FHA. No one should pigeonhole themselves before really exploring their options.

Are all FHA Lenders the same?

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