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How to Select Lenders when Buying a Home:By Justin Rychak, The Money$crooge If you are like most people, buying a home seems to have a lot of moving parts: Dealing with Lenders and Realtors, qualifying for a loan, finding the right home and selling your current home all take time.This article is going to focus on finding the right lender for your new home. We have links to other articles that get into negotiating with sellers, mortgage predictions, etc at the bottom of this page. There is also a mortgage calculator at the bottom. However, read this article before using the calculator. You will be glad you did. (Refinancing? CLICK HERE for advice and a refinancing calculator.) First, I want to clear the air about a few misconceptions and techniques that lenders use. Since I’ve been in the mortgage business for over 7 years and ran a few multi-million dollar producing divisions, you can take this to the bank (pun intended).
Shopping a few lenders and using simple negotiation techniques will easily save you Thousands when buying a new home- This is NOT unethical.- This does not take much time to complete. - It is easy to do. - It can be used regardless of your personal home buying situation. Understand this: Except for call centers and online sites like lending tree, every loan officer who has been in the mortgage business more than 6 months can set their own rates. Translation: they can issue you a lower rate than the first one they quote you. Yes. This true. By comparing lenders against one another when buying a home, you can easily negotiate $200 to $400 off their fees and receive at least .25% to .125% lower in rate. Quick math will show you that this will easily save you $5000 or more in first few years of your loan. So how do you do it? It’s in how to deal with them. Use the following steps: 1) Get your paper work in order before you call. Having every piece of information ready before you call will do 2 things:
* Cut down on the time you have to spend with the lenders. * It will put the lender on notice that you know exactly what you are doing. Believe it or not, this will help you secure a lower rate. 2) Call up at least 3 lenders and use win/win negotiating strategies. We provide easy-to-follow scripts as part of the Ultimate Homebuyer System that you can use to get lower rates and fees. In your first call you want to negotiate lower fees. You cannot lock in until you have a home, so don’t worry too much about who offers the lowest as rates change daily.
3) Compare good faith estimates. Lenders on ONLY in charge of the 800 series fees or fees that they directly control. Many lenders will initially low ball the other charges simple because they are not know.
4) Pick a lender AFTER you have a ratified contact. Call up each of the lenders after the contract is ratified, provide them with the contract information and have them provide you with the best rates. We provide scripts for this as well that makes it easy to side step the techniques lenders use to get you to use them. (This is when you negotiate lower rates)
5) Once you lock in stick with that lender and provide them with any and every piece of information necessary. There has been a lot of changes in the mortgage industry. Lenders are strict even for the most qualified. Expect it and proactively do what you need to do to help. Remember, the loan officers only get paid when you close so it is in their best interest to help you.
If you are serious about buying a home, don’t rush into it. Create a plan. In today’s market you can buy a great home at a great price. AND continue to save for retirement. Take advantage and create a plan for your finances before and after you buy. You won’t regret it. Remember, no one will guard your money like you will. Justin Rychak is a mortgage banking executive turned financial coach who helps individuals achieve lasting change in their finances. If you are interested in learning how you can negotiate lower interest rates or create a financial plan to buy a home, click the first link below.  Other Moneyscrooge articles and information: Ultimate Homebuyer System - Ensure a great deal. Don't sacrifice your retirement Mortgage Rate Predictions Affordability Calculator Copyright LJ&L Inc. (MoneyScrooge) Article: Lenders Home
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