The Method of Choosing Mortgage Lenders
Technically a Mortgage lender is an institution which provides loans to people to purchase real estate. These institutions could be banks, credit unions, life insurance companies, trust companies that provides finance for buying land, houses and real estate. There could be thousands of mortgage lenders in your area varying from small local banks to large corporate houses which finance real estate across the nation.
Basics of a Mortgage Lender
Mortgage lenders could be associated with private banks which guarantee real estate debts like the ANZ and Westpac. As a buyer you need to find the company which gives the loan for the least interest rates and fees. The mortgage finance industry is largely based on commissions and potential customers can compare the terms and other facts with the Internet quotes. The basic difference between a broker and the lender is a broker works on a shoe string budget and there are less overhead costs as compared to a lender like a bank which would have to invest a larger sum for overhead expenses. Mortgage broker is in business to facilitate transactions, which means that they never lend money but get you a suitable lender who will provide the finance. Such brokers have access to a variety of lenders who lend for different situations. The final arbitrator is you who will decide which is the best choice for you. Some companies and financial institutions double as brokers and lenders. It is important that you know exactly who you are dealing with because if it is a broker he will be paid on the basis of commission on the full loan amount.
Mortgage Loan Offer
An offer made by the lender is not always the final word and there is sometimes space for negotiation. Most Mortgage lenders keep a percentage for themselves above their usual cut for generating a loan. Therefore who knows an a particular day the lender can offer different proposals to two persons with identical qualifications. But it is not unprofitable to tip the broker since he can save a lot of money by asking the lender to waive off extra fees and costs. Remember it is never bad to ask a lender for some waivers!
Another question is how to find the most suitable Mortgage lender? You can surf the net and compare the offers from different lenders. Suppose you want to finance your home. It's going to be the biggest investment in your life and it's important finding the best mortgage lender for you. Mortgage lending terms are similar in most cases and the variations are made to satisfy the peculiarities of the situation. Mortgage brokers(given they generate enough turnover) have access to many great loans and products to offer you, where as a bank or lending institution have only their own which may not always suit your needs.
Always get a second opinion and ensure you get the best deal!
This article was contributed by Samantha Taylor who the Community Mentor of MortgageFit and has been contributing her suggestions to the Community since 2005. Not just that, she has also made notable contributions through the various articles written on different subjects related to the mortgage industry. She is specialised in writing on “Mortgage Lenders” and on other mortgage related articles."