If you are in the process of refinancing your existing mortgage, applying for a new mortgage, or shopping for a home equity loan, you may feel overwhelmed with the choices available to you. There are many different types of lenders; a mortgage lender exists for nearly any financial situation. Choosing the wrong mortgage loan could cost you thousands of dollars. As a homebuyer you need to do your homework and research mortgage offers and a variety of lenders to choose the best loan option for your financial situation.
Types of Mortgage Lenders
There are many types of mortgage lenders in competition for your loan. These lenders include credit unions, banks, local mortgage companies, online mortgage lenders, and specialty lenders including bad credit mortgage lenders.
Each type of lender has pros and cons. Banks do not usually offer the best interest rates. Your Credit Unions may have better interest rates, but you need to shop from a variety of lenders to find the best rate.
When shopping for a specialty mortgage lender, remember these lenders charge a premium for their services. There are lenders that offer bad credit and bankruptcy mortgages exclusively. Traditional mortgage lenders do not typically cater to homebuyers with poor credit; you may need to enlist the help of a mortgage broker to find a lender willing to work with your credit.
How can you find the best mortgage for your financial situation? A mortgage broker may be able to find loan offers for you that you would not find on your own. Mortgage brokers work for a commission, their assistance could cost you a fee. Mortgage lenders often pay this fee for you; however, it is important to understand what the fee is and who’s paying it before entering an agreement with a mortgage broker.