Shopping for a Loan
Securing a mortgage is a big step, but it doesn't have to be intimidating. Understand the different types of loans and lenders, and you can take control of the process to get the loan that's right for you. With thousands of loan options available, it's important to work with a trusted partner who understands the array of loans and can match them to your needs, wants and desires.
Mortgage Loan Brokers
Mortgage loan brokers specialize in pairing you with a lender who offers what you need – maybe a lower interest rate or a loan with no down payment. Loan brokers can directly make loans, too. The primary advantage of using a loan broker is the number of financing alternatives available to you. Only a mortgage broker represents multiple investors and lending institutions so you can "shop around" for the best fit. And, a mortgage broker's services are available oftentimes at the same cost as a mortgage banker.
Mortgage bankers offer home loans and then process and sell the mortgage to a larger investor or to a secondary mortgage market.
Traditional financial lenders, like mutual savings banks, savings and loan associations, insurance companies and certain commercial banks, usually offer mortgage loans in addition to their other services.
Private lenders, both individuals and groups, are another mortgage source, and are often considered for second mortgages. For example, a seller or employer might provide a mortgage loan, however, private lenders often loan money as a means of real estate investing. You can also expect to be charged a higher interest rate from a private lender.
Cooperative institutions also provide financial services to their members. If you're already a member, your credit union may offer a 30-year conventional or government-insured mortgage with competitive interest rates.