Risks of a mortgage
Some mortgage brokers attempt to increase their profit by writing
hidden costs into your loan. Best hedge: know the loan process
and ask questions.
oversight: Unlike mortgage bankers, mortgage brokers
are not subject to licensing and regulation in all states.
Banks, thrifts and credit unions
Most financial institutions offer a limited menu of loan products
just as mortgage banks do. They typically hold mortgages in their
portfolios or sell them on the secondary market.
Home builders and real estate
Many large home builders and real estate agencies now own their
own on-site mortgage company to make it easier to buy their properties.
These affiliated companies may operate as a mortgage banker or broker.
Mortgage lenders have proliferated on the Internet in recent years,
offering fast, easy loans at competitive rates. Some are online
channels of brick-and-mortar financial institutions or mortgage
brokers, others are Internet-based banks or brokers.
Which lender is right for you?
Depending on your credit history and circumstances, you may benefit
by using one source of mortgage loans over another.
||Which lender is right for you?
kind of borrower are you?
source to shop
Tips for working with lenders
Ask friends and family members for suggestions, especially if
they've recently obtained a loan.
Check credentials: Mortgage
bankers are regulated by either your state's department of banking
or division of real estate. Check with the one appropriate to
your state to see if a lender is in good professional standing.
Mortgage brokers may be state regulated or not. If not, check
with the local chapter of the National Association of Mortgage
Brokers or the Better Business Bureau to see if their record
is clean. The Library of Congress has a good index of state
and local government Web sites.
Do your homework:
Learn about typical mortgages and ask questions when something
looks amiss; a broker may be trying to pad closing costs or
other fees at your expense.
Take care online: There
are plenty of attractive deals online, but first make sure you're
dealing with a reliable broker or lender.
Extra care during peak season:
Unscrupulous lenders and brokers are more apt to quote
you bogus rates or slip in extra costs during peak home buying
season, in hopes you won't notice.