Lenders make it sound so easy. Simply fill out a quick online application, or even do it over your phone – and “poof!” – you have loan approval.
At least, that’s the cover story. But as with most things that might seem too-good-to-be-true, this one usually is, too. Not because it’s necessarily difficult to get loan approval, but because these companies aren’t really telling the whole story.
Rick Piette, owner of Las Vegas-based Premier Mortgage Lending explains it this way: “The simplest analogy would be to remind you about the last time you went to buy a new car.
“Remember how you saw and heard ads that promised you a “great deal on a new car”? Perfect timing, because you were in the market for one and this sounded like the perfect solution. But then you walked in the door and things, uh, ‘changed.’ A bunch of pesky details came up. It turned out, the deal they advertised wasn’t for the type of car you want, or you had to pay for more options than you wanted. Perhaps it required a certain credit score you didn’t have – so the payments and interest rate were higher than you were expecting. And then there was all the fine print about the warranty and the financing terms.
“The point is, they got you in the door with big promises, and even though the story changed once you were there, you already felt “invested” in the process. So maybe you stayed, accepting each of their revisions to the deal you were expecting one by one – simply to get it all over and done with.
“And there’s nothing really wrong with adjusting your expectations in a transaction – if the cost and the stakes aren’t more than you’re willing to pay. Sometimes it’s really more a matter of what your time is worth, so if we pay a little bit more for a car we really love, that’s not necessarily going to be a deal-breaker.
A home, however, is a different story. Large national banks and online mortgage companies use those same tactics to ‘get you in the door’ to capture your business – hoping that as they slowly change the details of your loan’s cost, rates and the details, borrowers will (again) be too invested in the process and will just accept it all because it’s easier than starting over somewhere new.
““Gotcha.” According to Piette, “That has to be how those lenders feel. They’ve just added another loan to their quota, another bonus to their paycheck. You just became a number, a source of income, and once they’ve hooked your application they know you’re more than likely to stay – no matter how smooth (or not) you loan process goes. It’s a sad commentary, but it’s true more often than we’d like to admit.”
However, if there’s one thing that Rick Piette would like to say to every mortgage borrower, it’s this: “Picking the wrong mortgage lender can unnecessarily cost you thousands of dollars out of pocket – because all mortgage lenders are not the same. Taking an hour or two of your time to shop around to compare interest rates and fees can easily turn into the best ‘hourly rate’ you’ve ever paid yourself!” (To see how easy it is to compare mortgage loans, visit our KnowBeforeYouOweNevada website.)
How does that work? Like this: With a bank or mortgage banker, usually your only options are for the loan programs their own institution offers. That means that no one is ‘competing’ for the opportunity to make your loan – or trying to get you the best rate and fees. It’s all done in-house, at the cost that big institution wants you to pay.
“But for a Mortgage Broker like Premier, finding the best loan out of competitive options is precisely what we do. Borrowers fill out one loan application, provide supporting documents one time – and Premier shops with its network of lenders to find the best rate and the lowest fees.
“In fact, Premier Mortgage Lending even offers a true “No Fee Mortgage” – that charges borrowers absolutely $0 for Loan Origination, Underwriting, Document, and Processing Fees. As these items can add up to as much as 4% or more of your loan amount, (that’s $10,000+ on a $250,000 loan) – you can see why choosing the right lender is critical.
“These “quick and easy” lenders also fail to explain that while filling out an application takes only a few minutes, obtaining formal loan approval is a process that takes time. It requires proper documentation provided within the proper time frame, adds Piette. “There’s a sequence, problems to address, deadlines to meet – and it must all be coordinated with the seller, inspectors, escrow and title companies.”
One other thing to remember: This process takes time. If you chose an online lender, you’re working with a “company” – not a Loan Officer that’s dedicated specifically to you and your loan, as you would be with Premier Mortgage.
“Usually with an online mortgage lender, you call an (800) number, get transferred around, mail documents, and often speak to someone new each time you call. That lack of clear communication is how questions can go unanswered, problems aren’t addressed and resolved, deadlines get missed, and you may even see your interest rate and fees unexpectedly go up at the last minute – when it’s too late for you to change lenders.
“That doesn’t happen at Premier. Because you’re working with an experienced Loan Officer who lives here in Las Vegas, knows the market, and has relationships with the Realtors, lenders, title and escrow companies who will be handling your loan,” adds Piette. “Personal service like that doesn’t come over the internet. Real people, where you live, working for you – that’s the Premier Mortgage difference.”
Learn more about the experienced professionals available to help you buy that home you’ve had your eye on by calling 702.485.6600 – or visiting the Premier Mortgage Lending website.
Premier Mortgage Lending, NMLS #393282, is located at 701 N. Green Valley Pkwy., Suite 125, Henderson, 89074. The full-service lender is a member of the Las Vegas, Henderson, and Boulder City Chamber of Commerce, Better Business Bureau and Southern Nevada Home Builders Association, as well as an affiliate member of the Greater Las Vegas Association of Realtors.