How to Compare Mortgage Lender Representatives with Ease

by Barbara from Ohio, USA

Ask Kate how to compare mortgage lender representatives with ease: Kate, If you are not supposed to show multiple applications on credit checks because it damages your credit score, how do I interview 3 lenders to see who would give me the best product?


Barbara continues... The lenders say they need all my info and to run a credit report to see if I qualify with them.

I am soooo confused how you go about getting a loan approved before you know what house you want to buy, yet I can't go find a house to make offer on without a lender already lined up. Help! Thanks Barbara

PS Where do I find the answer to this or other questions people ask?

Kate Answers: How to Compare Mortgage Lender Representatives with Ease

Ask Kate at Get-Your-Best-Mortgage-Rate.com
 Dear Barbara,

Let's unscramble the confusion. Choosing a lender or getting a credit report? Finding a house or getting pre-approved?

Which DOES come first? The chicken or the egg?

Actually, before those questions can be answered, let's discuss shopping for lenders. I think the best way to start is by talking with friends, relatives, neighbors and co-workers who have recently bought a home or refinanced their mortgage.

Ask who they used for their last mortgage. Were they satisfied with the outcome? Did they feel they were treated fairly?

Don't forget another excellent source, right at your fingertips, your Realtor. Agents work closely with mortgage professionals to close real estate transactions for home buyers. Realtors see the nitty gritty, receive feedback, and quickly learn the popular sources for mortgages.

So it makes sense to ask them where they'd be comfortable sending their mothers, sons or daughters for home loans.

Unscrambling the Credit Conundrum

Okay, now you have a few names of lenders and are ready to begin calling them. I understand your dilemma - how confusing it is to be told to protect your credit scores by limiting the number of credit checks, only to hear lenders tell you they can't help you without performing one.

But in the beginning, you are not contacting a lender to ask if YOU can be pre-approved for a mortgage, which of course requires a credit report. You are calling to qualify the LENDER!

I understand this is not a common practice. But think of it like this... a job interview! You will be hiring a mortgage professional to compile your paperwork and personal data, submit it to a lender, obtain your loan approval, and walk your transaction through to successful conclusion.

In plain English, the lender is responsible for securing your financing so you can buy the home of your dreams. That's why, before your credit report is ordered, it is important to ask questions, just as any employer would ask during an interview. Go here for my helpful questions to ask your mortgage lender.

To help you become comfortable in this role, I've also developed a six step method to compare one mortgage lender to another. To learn how, go to Compare Mortgage Rates and Lenders in 6 Simple Steps and then come back here so we can discuss your second question.

Unscrambling the Mortgage Pre-Approval Conundrum

Now that you've interviewed lenders and narrowed down your choices, it's time to get pre-approved for a mortgage. Which comes first? Do you shop until you discover your dream house and rush to be approved for a mortgage so you can make an offer to the seller?

Or do you start by asking how much you can borrow, shop for a house in the pre-approved price range, and then make an offer?

I suggest you browse through a few open houses in the neighborhood where you'd like to live. Then use my mortgage checklist to help you organize your paperwork and make an appointment with the lender of your choice.

Tell the lender representative you'd like to be pre-approved for the maximum amount. When you obtain your mortgage pre-approval, match up the required down payment and monthly house payments to the amount you can afford.

In a perfect world, you can afford the pre-approved amount and it will be sufficient to buy the size of home you prefer.

But more than likely, you will have to adjust a few numbers at this point. This process should not be rushed and THIS is why you want to experience the mortgage pre-approval process before you make an offer on a house.

Now this is important so please listen carefully. The amount of money the bank will loan you does not necessarily equal what you can afford. Go here to read more about mortgage pre-approval vs mortgage affordability. Don't miss this step. It's the secret to successful homeownership!

Ask Kate Answers at www.Get-Your-Best-Mortgage-Rate.com

You also asked how to find my answer to your question on my website. When I answer your letter, you receive an email (as long as you provided one) with a link bringing you straight here. Click the link and presto! My answer!

You will also begin receiving notices when I answer other Readers' questions, assuming you opted in for the emails. The same goes for comments from other Readers. I've answered hundreds of Ask Kate questions over the years. Enjoy!

Comment and Ask Kate

Barbara, one more thing. Is this page is helpful to you? I'd like to hear back from you.

You (as well as anyone reading this) can add a comment to this page. (Click the comment link following my answer.) Or, go here to ask Kate another question.

Best wishes,

Ask Kate

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How to Compare Mortgage Brokers
by: Lamont in Raleigh, NC

Kate,

Is there a best way to shop for mortgage brokers? Online? Word of mouth? Realtor reference?

I'm relocating back to Chicago, and would like to get mortgage process going, to see what I qualify for.

Thanks Kate.

Hi Lamont, Kate here...

I suggest getting referrals to mortgage brokers from friends, relatives, neighbors, and co-workers as well as real estate agents.

Although I wrote this for an FHA borrower, the same holds true for home buyers who want a conventional loan... How to Find FHA Lenders with Proven Track Histories.

Here's a handy list of questions to ask to help you shop lenders for mortgage preapproval.

Best wishes, Kate

Click here to add your own comment.

You can also ask Kate about your mortgage at How to Find Your Mortgage Lender.

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