Posted on: 11th May, 2010 10:20 pm
So I am at the stage where I need to get prequalified for a mortgage. I'm a first time home buyer so excuse my ignorance.
I heard the big retail banks such as Chase and B of A are being very tight with their lending requirements.
An aquaintence put me in touch with a loan officer from a smaller company, I don't know if they are a bank or what. Company name is Nova Home Loans. Has anyone heard about them and are they a good company to work with?
What are the advantages/disadvantages of working with a company like this rather than a big bank?
I heard the big retail banks such as Chase and B of A are being very tight with their lending requirements.
An aquaintence put me in touch with a loan officer from a smaller company, I don't know if they are a bank or what. Company name is Nova Home Loans. Has anyone heard about them and are they a good company to work with?
What are the advantages/disadvantages of working with a company like this rather than a big bank?
Hi ilancooke,
I haven't heard about Nova Home Loans but while I Googled the name, I did find their official website - "http://www.novahomeloans.com/index.asp". Whether you work with a small company or deal with a big bank to get a loan, you should always check out the loan docs carefully. If you find anything which you do not understand, don't hesitate to ask your lender about it. Also, check out the loan terms and conditions that the lender is offering you. You should go for the loan only if you're able to pay it off.
Thanks
I haven't heard about Nova Home Loans but while I Googled the name, I did find their official website - "http://www.novahomeloans.com/index.asp". Whether you work with a small company or deal with a big bank to get a loan, you should always check out the loan docs carefully. If you find anything which you do not understand, don't hesitate to ask your lender about it. Also, check out the loan terms and conditions that the lender is offering you. You should go for the loan only if you're able to pay it off.
Thanks
When meeting a company you know too little about, start searching Google and running ADVANCED search options.
Search: Names, addresses, phone numbers.
Search their name on financial news sites.
Search complex terms such as nova+scam or Nova+complaint
Good Luck
Search: Names, addresses, phone numbers.
Search their name on financial news sites.
Search complex terms such as nova+scam or Nova+complaint
Good Luck
Loan approvals are difficult irrespective of who the company is. Most smaller lenders are brokering out their product, so you might end up with Wells, BofA or any of the others you're wary of.
The market is always buyer beware, and it doesn't matter who you're hooked up with. You must be vigilant in doing some homework so that you know who you're with, what they're about and how they operate. Don't be afraid to ask hard questions and get as many other opinions are you are able to.
The market is always buyer beware, and it doesn't matter who you're hooked up with. You must be vigilant in doing some homework so that you know who you're with, what they're about and how they operate. Don't be afraid to ask hard questions and get as many other opinions are you are able to.
I have to tell you that my home loan is with B of A. I've been very happy with them. I can go on line and transfer my loan payment straight out of my checking account. I know that they have it in a timely manner, and I get a discount on the interest rate for having it drafted like that.
While you might sign with someone who is looser on requirements, etc. a lot depends on who is *servicing* your loan. And the company who has you sign with is almost never the company who handles the service. My mother, on the other hand, took out a home loan with a company I'd never heard of and her loan servicer has been changed at least a dozen times in the last 10 years. She's been billed late fees because the servicer changed and she wasn't notified, so she sent payments to an incorrect location. She's also taken to mailing in each payment as a certified letter, return receipt requested because one servicer would actually deposit the check and it would clear her bank BEFORE it was due, yet they "didn't process it in time" and try to make her pay late fees. So she spent a day every month on the phone yelling at people and faxing bank statements showing that the payments cleared in order to get the late fees taken off.
While you might sign with someone who is looser on requirements, etc. a lot depends on who is *servicing* your loan. And the company who has you sign with is almost never the company who handles the service. My mother, on the other hand, took out a home loan with a company I'd never heard of and her loan servicer has been changed at least a dozen times in the last 10 years. She's been billed late fees because the servicer changed and she wasn't notified, so she sent payments to an incorrect location. She's also taken to mailing in each payment as a certified letter, return receipt requested because one servicer would actually deposit the check and it would clear her bank BEFORE it was due, yet they "didn't process it in time" and try to make her pay late fees. So she spent a day every month on the phone yelling at people and faxing bank statements showing that the payments cleared in order to get the late fees taken off.
Lisa, I believe that your Mom's situation is not the norm (I sure hope so!), and that in today's marketplace, it's virtually impossible to avoid being involved with a lender that would not transfer servicing. There's so much money to be made in servicing that the business is ever-expanding.
Most lenders/servicers allow for automated payments, as with the arrangement you're in with BofA. Clearly, if one can handle payments in that fashion, it's a definite benefit.
Nowadays, dealing with a company that someone else has never heard of isn't a rarity, nor is it necessarily problematic. After all, some of the "best" of the companies we've known have folded over the last few years, and mergers and acquisitions will forever change the landscape.
I recognize your Mom's experience as a cautionary tale, and we consumers must ever be on the alert, but I don't believe that those situations are rampant.
Most lenders/servicers allow for automated payments, as with the arrangement you're in with BofA. Clearly, if one can handle payments in that fashion, it's a definite benefit.
Nowadays, dealing with a company that someone else has never heard of isn't a rarity, nor is it necessarily problematic. After all, some of the "best" of the companies we've known have folded over the last few years, and mergers and acquisitions will forever change the landscape.
I recognize your Mom's experience as a cautionary tale, and we consumers must ever be on the alert, but I don't believe that those situations are rampant.