Do You Shop Lenders on Every Deal or Stick With One You Trust?

Question

I’m curious how people handle this once they’ve done a few deals.

Say your usual lender has been reliable, answers quickly, and already knows how you operate. Then another lender comes in a little cheaper on the next deal.

Are you switching for the better terms every time, or is there a point where having someone you already trust is worth paying a little more? I feel like the cheapest lender looks great right up until something weird happens two days before closing. For people doing volume, do you still shop every loan?

Mike Grudzien · Answer

Nothing beats long term trusted relationships.

Warren Mah · Answer

I typically stick with one, because often times the convenience and relationship built with one outweighs the slightly cheaper deal the next lender is potentially offering. I will use a couple different lenders from time to time but I am not actively shopping my deals to an array of different lenders.

Adam Tafel · Answer

Really depends on the borrower - for most of my clients I recommend talking to at least 2 lenders - but I rarely shop personally. I have a great relationship with a small bank for my refis, they have all my info, approval is quick and the product is exactly what I need. It’s also nice having lots of rentals under the same servicer. For purchases I use a few different lenders, but I am not interested in bringing on anyone else - again, because these lenders already have all my info! But if I were brand new to REI with more time on my hands, I might keep applying with new brokers in order to get the best deal on every deal, nothing wrong with that.

Chris Seveney · Answer

Stick with one you trust as long as the terms seem in line with industry standards

Jedd Thayer · Answer

(I'm on the lending side, so factor that in.) I don't shop every loan. I keep two or three lenders who've proven they can close and put deals to them. The reason is I price the downside, not just the coupon. If the loan falls apart right before closing, you can lose your deposit, the deal, and the agent's trust. That costs way more than a slightly cheaper rate. I'll move for a materially better structure, not for a few bps. The thing you're paying the small premium for isn't loyalty it's proven execution.

Bill Murray · Answer

Finding a realibale lender is the best way rather shopping everytime.

Do You Shop Lenders on Every Deal or Stick With One You Trust?

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