Online mortgage lending is quickly becoming a very big part of the broker market. While online mortgage services once represented a tiny share of the market, such services are steadily gaining popularity with even the most conservative of consumers. Indeed, as the demand has increased, so has the proliferation of online mortgage companies. Which online mortgage company is best for you? Here are a few tips to help you find the best online mortgage for your needs.
1. It is important to educate yourself on online mortgage lending.
If you work with a realtor, ask for their advice. Have they ever worked with an online mortgage broker? Have they heard any word as to whether or not a particular online mortgage broker is good or bad? If you work with a financial advisor, seek his or her guidance. Ask friends and relatives about their experiences. And don’t forget to check with your bank: Many traditional “brick and mortar” financial institutions now offer online mortgage services. The more information you gather, the better prepared you’ll be to make an informed decision.
2. Compare several online mortgage lenders.
Don’t settle for the first online mortgage broker you see, examine at LEAST three before making this crucial decision. Choose several lenders that have a long history, a solid reputation, and a well-known name. How do their rates compare? Other aspects of the mortgage should be compared as well, such as: closing costs, payment options, and hidden fees. These investigations will allow you to assess the total costs of each online mortgage company you consider.
Finally, compare any additional services each online mortgage company may offer. Many provide nothing but discount mortgage services. However, some online mortgage lenders have additional programs to help with further needs, such as identity theft protection and credit repair services. Others may offer help buying a home. If these types of services are important to you, make a mental note.
3. Narrow your choice to two companies.
Once you’ve compared the interest rates, closing costs, fees, additional services, and other details of several online mortgage services, narrow your choices down to the two companies that you believe will best meet your needs.
4. Research each online mortgage company.
Research both online lenders individually. Do they even have a business address? Do they have a number you can call toll-free? If so, give them a call and ask for information. Is your call handled promptly? Use the BBB (Better Business Bureau) to look up potential company’s records. Customer complaints are going to appear for any business, but finding out there is a trend of similar complaints: it is time to put up your guard. Sometimes, there will be a clear winner. Don’t put too much pressure on yourself if you are split. There’s no harm in submitting an application to both companies, and seeing which gives you the better offer.
5. Submit your online mortgage application.
This should be the final step, only when you’ve carefully researched a company and have decided you want to do business with them. Why? First, a free mortgage application contains a wealth of personal information that could be misused. By limiting the access to your information, you’re limiting your exposure to identity theft. Secondly, every online mortgage application you submit shows up on your credit report as an inquiry. Having too many inquiries over the course of the year may adversely affect your credit score.
Online mortgage lending is relatively new, but it doesn’t have to be intimidating. By doing a bit of homework, you can feel comfortable that you are making an informed decision that will pay off for years to come.