But, in this era of “browse, click, and buy” how can your buyer be sure they really are receiving the best mortgage service and options to fit their needs? If your buyers are only shopping an online lender, they may be leaving money on the table and incurring headaches at closing. Check out these reasons to recommend a local lender.
Down Payment Assistance Programs and Tax Credits
There are numerous agencies on the city, state and even regional level that offer down payment assistance grants and tax credits to qualified borrowers. These agencies often require that the lender have a physical office within the state to be an approved lender partner for that agency to offer the grants and tax credits. Even if your buyer already has their down payment or is using a 100% financing product such as VA or USDA, the additional funds can be added to increase the down payment or used to help cover closing costs. If they are not consulting a local lender, they may be missing out on funds and tax credits available to them.
Improving Their Credit Score
Another way a buyer may be able to save money is by improvements to their credit score. The higher the score the lower the interest rate they may be eligible for. Many times, a borrower’s credit score can be within a few points of qualifying for a better interest rate. The credit report may contain errors or still reflect balances on items that have been recently paid off. A local lender would be able to review the credit report and report any updates needed, and then have the credit “rescored.” The rescoring may be the boost your buyers need to help them qualify for a better mortgage rate.
Smoother Loan Process and Closing
A rough loan process and delays at closing can cause headaches and be an unexpected burden on the buyer’s budget from extra moving and storage fees to hotel bills and extra time off from work. Local lenders are invested in their communities and have a personal stake in the loan process going smoothly and closing on time. They are reachable by phone after hours and on weekends. A local lender is also going to be more familiar with HOA fees, local assessments, and jurisdictional taxes so there are no surprises on the closing disclosure statement. Lastly, a local lender will be in the same time zone as your closing so if there are any last-minute documents or changes needed you don’t have to worry about an office in another time zone that may be closed.
As your buyers browse and click their way through mortgage options, make sure their comparison shopping includes a local lender. It could save them money and hassle.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.