Posted on: 19th Nov, 2012 11:41pm
Mortgage lenders compete with each other in offering you loans. Rates and the terms of the loans offered by them also vary. If you can switch to a company/lender which offers loans at better rates, then you can save a lot of money.
In the current market situation, with some companies offering attractive rates, many home buyers like you are mulling over switching lenders. Before switching mortgage lenders, you need to follow these 4 tips.
One major advantage of switching lenders is that it reduces your monthly payments. Again, frequent switching means that you have to pay the processing fees every time.
In the current market situation, with some companies offering attractive rates, many home buyers like you are mulling over switching lenders. Before switching mortgage lenders, you need to follow these 4 tips.
Compare the interest rates offered by others
Before switching your existing home loan, you need to do a bit of research. You should gather information on the rates offered by others. If the rate offered by a new lending company is just marginally below the existing rate, then it won’t be wise to switch.Bargain with your existing lender for better deal
Rates offered by other lending companies may be more attractive than the rate offered by the existing company. You can negotiate with your existing lender for a rate cut. Your request may also be accepted. Otherwise, you have always the option to switch to another company. Again, if you have good credit score, you can use that to bargain with the lending company.Shop around
If the idea of switching lender has come to your mind, then you must shop around and find out the rates offered by several lending institutions. This will help you pin point the lending company which offers the best deal.Bargain to lower the processing fees
For the processing of the fresh loan, the new company charges 0.5% to 1% of the loan amount as processing fees. You need to bargain hard with the new lending company to reduce or waive off the processing charges.One major advantage of switching lenders is that it reduces your monthly payments. Again, frequent switching means that you have to pay the processing fees every time.
I wanted to switch lenders and had taken steps in this regard. Though I was supposed to switch on 19th October but I received an extension till November 20th… This will where I committed a mistake. Now I learn that my loan still hasn't been looked at by the underwriter!! We turned in all of our conditions within 24 hours and they were sent to the underwriter on November 7th and they're still sitting there.The seller is now refusing to extend our contract further UNLESS we change to a lender of their choice. Their lender has stricter credit requirements and we don't qualify now since our original lender has run my credit so many times. I'm not really looking for answers, just venting. I've been living in a house that is all packed up because we thought we were moving a month ago. Our rental is already slotted to be re-rented out. i just feel hopeless. I can't believe this is happening. We found the house of our dreams for a wonderful price. And now it's being ripped away by an incompetent mortgage company.
I can understand how tough things are for you. You should contact your seller and negotiate with them so that they give you some more time to complete the deal with the lender. Let them know about your problems. Meanwhile you should also contact your lender and ask him to complete the closing ASAP.
Hi Hapless,
Unless you can negotiate with the seller and sort out the matter with him, it will be difficult for you to get the property. You will have to somehow convince the lender for letting you go with this lender.
Unless you can negotiate with the seller and sort out the matter with him, it will be difficult for you to get the property. You will have to somehow convince the lender for letting you go with this lender.
Not sure if this helps but the agents and listing agents and sellers also, need to be advised that the mortgage market is not what it used to be. There was just a report done on the housing market and the time it takes to process loans. From the report the average funding time is 54 days on refinances, slightly better for purchases. If agents understood this, they would not do 30 or 45 day escrows, but opt for 60 day escrow to be safe. Good luck to you.
