To secure a mortgage loan, you will need to find a lender.
In the past, this entailed walking into your local bank or credit union and simply asking for a loan. There is now a massive online marketplace, giving borrowers thousands of different options to find a lender.
This may seem intimidating, but a little extra effort can actually save you time and money down the road. Plus, these online-based tools help to streamline what is usually a paperwork-heavy process.
Overall, choosing the right offer can help you save money on fees and interest paid over the loan’s life. Here’s how you can find the best mortgage lenders online.
The Different Types of Lenders
It’s important to get quotes from multiple lenders and compare their offers. This will allow you to evaluate three essential factors – the interest rate, loan terms, and loan fees.
You can do this in a few different ways – directly through a bank, with a mortgage broker, or through an online mortgage lender.
A mortgage bank will secure the funds internally and typically offer a generic loan that is not personalized to the individual borrower.
You’ll likely have several face-to-face meetings, as each step in the process is handled in-house. This can be reassuring if you’re new to the mortgage process and have many questions.
A mortgage broker can be considered a third-party representative with relationships with various banks and lending institutions. This person will use their connections to find a quality loan and low-interest rate.
Online Mortgage Lender
Finally, using an online mortgage service will streamline the entire process. You can get a pre-approval online and submit necessary documentation via email. Quality online lenders will have a customer service team that can help with each step.
Online Mortgage Lenders
A few online mortgage-lender websites and tools will pre-qualify you with a loan that best matches your needs.
Here are some options to check out:
- Guaranteed Rate
The Process When Using an Online Mortgage Lender
An online mortgage lender is one of the easiest ways to get started.
Step 1: Questionnaire
They will start by asking a series of general questions, such as…
- Where are you in the process?
- When do you plan on purchasing?
- Where are you looking?
- What type of home are you interested in?
Step 2: Credit Check
Next, the site will ask to pull your credit. Make sure this is a soft credit request, meaning it will not lower your score. This will help the site figure out your price range and what you could qualify for.
Step 3: Personal Information
They will then ask for some personal information, including your first and last name, current address, social security number, income and assets, and possibly more.
Step 4: Results
The website will then match you with the best mortgage options based on the information you’ve provided.
In the end, you should have a pre-qualification or pre-approval letter (depending on the website) and a list of potential loan options.
Keep in mind – this is all done through an online questionnaire. You will not have to speak to someone directly over the phone.
Now it’s time to sort through the options and narrow your search. This is something you’ll want to do, whether considering a mortgage bank, broker, online lender, or even all three.
Here are the key factors to consider:
- Loan amount offered
- Required down payment
- Interest rate
- Rate lock requirements
- Personalized loan options
There are additional, more overarching things to consider as well.
Mortgage lenders are not built the same and work in different ways. Finding a lender who’s responsive and easy to work with will often save time and make the process much easier.
Most lending institutions are reputable companies. However, before signing on the dotted line, it’s important to look up how previous clients reviewed their service.
Of course, there will be the person who didn’t get approved and posted a negative review. You want to look more for the major red flags in terms of trust and reliability.