Comparing Mortgage Offers
December 4, 2008
Can somebody please tell me the best way to shop and compare mortgages? Most people think there is a secret to getting the best mortgage, but in reality, there is no secret. Obtaining the best mortgage happens by using common sense, trusting your instincts and working with a real mortgage professional.
Here are the most common methods to compare mortgage offers and rates:
Mortgage Comparison Sites
A mortgage comparison site will usually consist of a contact form and some general mortgage information. If you choose to complete the contact form, up to 4-6 lenders might contact you to offer a mortgage quote. You may or may not speak with a good mortgage company, but at the very least you should be able to compare mortgage offers. Remember one thing when using a mortgage comparison site. The person receiving your information is in competition with other companies to get your business. Some will say anything to get you to work with them. They won’t always deliver on their promises.
Online Advertising, Mortgage Banner Ads
We’ve all seen this ads since they are plastered all over the internet. The advertisements read something along the lines of “Get a $300,000 Mortgage for $850/month!” These types of advertisements are NOT the types of loans people want. They are option arm products that will get you into trouble if you don’t know how they work. If it sounds way to good to be true, it probably is.
Banks and Local Mortgage Companies
Banks, credit unions, and mortgage brokerages will often have their own website where they advertise their mortgage rates. If honest and updated daily, what you see advertised is likely what’s available. Remember one thing if anything. The rates advertised are typically a best case scenario loan program for borrowers with excellent credit scores. Read the fine print in all circumstances.
Choosing among the mentioned internet options is usually going to have the same end result. You will likely take an application, get a quote, and that quote may or may not resemble what was advertised. So how do you compare interest rates and mortgage offers?
Compare the good faith estimate and truth in lending documentation for all quotes you have received. Choose the option that makes the most financial sense and make sure you trust the company that is offering the mortgage.
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