You have lots of choices to make when you first begin your trek to buy and finance your home. First and foremost, the most important choice is which home to buy. Depending upon market conditions in your area, you might be surprised at how many homes fit your personal criteria. You may need a three bedroom home and you’d like it to be in a certain area of town, perhaps near good schools or a short commute to work.
Once you do find a few houses to look at, the sellers will want to see some sort of documentation that you’ve not only spoken to a loan officer but have a preapproval letter in your hand. Before you get to that point however, you need to make sure you’ve got a sterling loan officer. You can’t choose a loan officer based upon marketing or clever ads, you need to interview your loan officer first before you get too much further.
You want to know how long the loan officer has been in business. That’s not all that fair to new loan officers who may be just as capable at getting a loan to an approval but remember that loan officers close loans…that’s what they do. You may only interact with a mortgage loan officer two or three times in your entire home ownership career. You need to make the right choice.
A loan officer who has been in business for several years has been established as experienced, trustworthy and a good communicator. Loan officers who can’t bring in the business won’t be loan officers for very long, they’ll be on to something else. Good loan officers have seen all sorts of approval situations as well as understand which loan programs are ideal for your personal situation. An experienced loan officer has seen everything.
You want to know what your closing costs are going to be. A good loan officer will be able to give you a solid, verbal estimate over the phone without hesitation. A good loan officer will be able to itemize lender charges at the drop of a hat. A loan officer that doesn’t answer right away and replies a written cost estimate will be forwarded a day or two later probably isn’t your best choice. In my years as a mortgage loan officer, I knew these potential fees from an appraisal charge to title insurance. An experienced loan officer will easily be able to recite potential charges.
Finally, ask for referrals from previous clients. Your real estate agent will likely provide you with a few names of good loan officers so you should begin there. Real estate agents don’t get paid any referral fees for doing so but instead refer loan officer names because the loan officers don’t drop the ball during the approval process. Nothing is worse in an agent’s eyes to find out just a few days before closing that the lender won’t be able to provide closing documents on the settlement date. Remember, real estate agents don’t get paid until the deal closes.
These are just a few things to ask your loan officer and you’ll certainly ask more once you submit your loan application, but before you submit your application, you’ll first need to choose your loan officer.