6 minute read
July 9, 2022

How to Choose a Local Mortgage Lender

How to Choose a Local Mortgage Lender
6 minute read
July 9, 2022


In a hot real estate market, choosing a local mortgage lender can help you get an edge over the competition.

From house-hunting to purchasing, home inspections to closing on the offer, buying a home can be stressful—especially for first-time homebuyers.

Whether you’re considering your first home, interested in vacation or investment properties, or looking to refinance your current mortgage, local lenders can help. 

When you go local, you can put your mind at ease because they are also a part of your local community—your happiness is their business.

What is the difference between a lender and a bank?

A mortgage application through your bank can be convenient, especially if you already have a conventional loan through them, such as a car loan or personal line of credit. 

But national lenders often have stricter mortgage eligibility requirements because of federal compliance laws overseeing bank and credit union activities.

In addition, if you’re a first-time homebuyer with a brief credit history or a credit score of less than 620, successfully getting a mortgage through a big bank could make the process more challenging. 

In addition to tougher qualifications, local banks may have fewer loan options available. And because banks only offer their products—they don’t deal with multiple investors. 

As a result, they may also be limited in what type of loan or type of mortgage (mortgage products) they can offer potential home buyers. 

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In what ZIP code are you thinking of buying?

Benefits of working with a local lender

Local lenders offer several advantages to a potential homebuyer, that national lenders may not be able to.

Whether you go with a national or local lender, be sure to interview multiple lenders to compare rates and make sure you’re working with the best mortgage lender for your situation. 

Greater flexibility

Often local loan officers can help qualified borrowers that a national lender might not be able to service. These large lenders, like banks, have rigid lending policies, and borrowers who fall outside the guidelines can find themselves automatically declined.

In comparison, local lenders often have greater flexibility compared to banks.

In-depth local real estate market knowledge

Another benefit of partnering locally is that you benefit from their in-depth knowledge of the local market.

Because they are a part of the community, they know the local real estate market better than anyone else. As a result, local lenders comprehensively understand nearby property values and the local economy.

Locally known and trusted

An often overlooked benefit of using a local lender—is the trust factor. The trust your local lender has built in the community could be the difference between getting your dream home or missing out.

Sellers who have received multiple offers for their home can sometimes shy away from large banking companies or unfamiliar online lenders, preferring instead to deal with someone in their community—someone they know and trust.

Local mortgage lenders can save you money

They can work with multiple loan products, like the Federal Housing Authority’s FHA loan program or VA loans; local lenders can potentially save you money on your mortgage. And their eligibility flexibility makes them a popular choice with first-time homebuyers.

Furthermore, suppose you’re a military service member, surviving spouse, or veteran. If so, you may qualify for a zero down payment mortgage option through the home loan program via the Department of Veterans Affairs.

Local mortgage lenders can give you a fighting chance to find better loan terms and a lower interest rate.

FHA and VA loans are just two different loan programs that offer lower down payments or no-cash-at-closing mortgages that may not be available at some national banks.

Personalized service

You and your lender can work face-to-face and can be more effective in getting “on the same page” of an issue rather than reading through long email chains or playing phone tag.

It can be especially valuable if you have specific questions or a slightly complicated application process. 

Talk to local loan officers rather than being stuck on the dreaded customer service lines of national lenders. Small businesses with have fewer clients and can therefore give you a personalized approach, rather than treating you like a number. 

Paying it forward

In addition to personal benefits that can help make your mortgage journey smoother, you’re supporting your local community every time you work with an independent or local mortgage company, like Assist Home Loans.

You’re supporting local businesses that employ local workers, stimulating the local economy and supporting future growth.

How do I choose a lender?

Finding a local lender is easier than ever. 

Quickly search online for “local mortgage lenders” and your town or city to find local lenders nearby. In addition, you can check out mortgage loan rates online and play around with mortgage calculators to see what might be your monthly payments (mortgage payments).

Reaching out to family, friends, business colleagues, or local real estate agents and asking for a reference can also be an effective way to find a local lender.

Why do realtors prefer local lenders?

Survey results from Inside Mortgage Finance show that delayed closings and a lack of understanding and experience in dealing with local lending laws are factors that make real estate agents prefer local lenders. 

According to the realtors surveyed, delayed closings occurred more frequently when buyers didn’t use a local lender. 

Additionally, the survey found that national brands were more likely to make mistakes that could result in unnecessary delays if lenders or mortgage brokers were unfamiliar with state laws relating to mortgage lending. 

Many large financial institutions are slower to process applications due to size, processing framework, or underwriting process than local lenders. 

In a hot market, when time is crucial, and quick closing can improve your chances of a successful offer to buy, it’s easy to see why your real estate agent will prefer local lenders.

Choose local with Assist Home Loans for your home buying process

Using a local mortgage lender can provide a more personalized approach to the mortgage loan process and even help improve your chances of a successful offer to buy.

When it comes to buying or refinancing a home, choose the best lender for your financial situation.

It’s also important to remember that no two financial situations are the same. What works for your sister or best friend may not necessarily work for you.

Before deciding, take some time to consider what level of service you’re comfortable working with. What do you consider the most important parts of the home buying process?

  • Competitive rates? 
  • Personal attention? 
  • Mortgage pre-approval?
  • Mortgage insurance?
  • Closing costs? 
  • Something else?

Once you know what matters, it’s time to look for an experienced lender, like Assist Home Loan, who will not only meet—but exceed—your expectation on these essential matters.

At Assist Home Loans, we want to help you find the right mortgage for your situation. 

Reach out to a local loan officer at Assist Home Loans today.

Photo by Mikhail Nilov