Wise to shop around for next loan?

Question

Hi,

Wife and I are ready to purchase our next home. We can do the 20% down on most homes we’re interested in. Can I/should shop with different lenders? I’ve used the same lender for a couple of homes but have never looked outside for second options…

Let me know your thoughts

thank you everyone

Corby Goade · Answer

I'm a big believer in trust and relationships in this business. If your lender has been good to you and you trust them, I'd at least have a conversation with them about where your mind is at. It's a good opportunity to learn about the process for a pro. You'll at least get enough info to know where you can leverage and where you cannot.

Best of luck-

Armando Carrera · Answer

I appreciate everyone’s input! Love learning and getting information from pros in the industry.

Zach Wain · Answer

@Armando Carrera - I think shopping lenders is important, but its tough for a consumer to shop rates.  Most lenders do not mention the amount of discount points/lender fees they are charging for the rates they quote.  Basically, a lot of lenders quote low rates with really high closing costs to lure in buyers.

What I think is best, get a referral or two and speak to the loan officer.  Get a feel for who you like and who will treat you the best.  Rate/fees are important.  Also a lender that cares about your goals and suggests new products and ideas so that you meet your goals.  20% is not always needed.  Maybe that is perfect for your scenario, or maybe its better to only put down 10% so you can do a home renovation.

Everyone's scenario is different, find a loan officer that meets all of your needs

Erik Estrada · Answer

Hey Armando,

As a broker myself, If I am shopping lenders, I look for who is the most credible, who has the best communication, and who can close on time.

For the most part you will find similar rates if you shop around. Fees might change, but if the fees are very low, the service may be horrible.

Finding the middle ground is the key. Who is fairly priced and who can deliver

Doug Smith · Answer

I'm kinda mixed on this one. I've always been a believer in building relationships and loyalty, but if a lender isn't giving you their best deal out of the gate, then where's the return loyalty that they've been giving you? I would certainly quietly check the deals of others, especially the fees that are stacked into the loans more than the rates. If all is close to being equal, I would go with the lender you've worked with for a long time. Reagan coined the term "trust but verify". I think that's a good way to go here. I certainly appreciate the relationships I've build with customers. There is always someone that will undercut your lender, but "closability" and trust are big concerns as well. Often the bottom-feeders that sell only rate either can't close and give you the deal they sold you or they can be shady in other areas. If you do choose to go a different direction, simply make sure the lender is a credible pro. Good luck to you.

Dennis Muno · Answer

Hello Armando,

It is always wise to check pricing from multiple lenders before you proceed. You will be surprised the amount of bogus fees some lenders charge and also how much money you can save in monthly payment when you compare lenders. Better yet, you could also ask a local mortgage broker to shop lender pricing for you.

A second, third look is always better than one