Best Mortgage Lenders for September 2021: Find Your Best Fit


How can homebuyers feel more confident when choosing a mortgage lender?

I am a big believer of using local mortgage lenders, especially credit unions and community banks with a large mortgage business. Buyers in today’s market need to do everything they can to convince sellers that they will actually close the transaction on time. Even with loans that have been pre-approved, there are final checks the lender must make before funding the loan. If a problem arises, it really helps to have a real, live person you can meet with face-to-face to resolve it quickly.

Even more importantly, local lenders depend on good relationships with local Realtors, and if they don’t take care of you it will directly impact their future business. When I hear about financing problems causing a real estate closing to fall apart, it almost always results from the borrower having chosen a national rather than a local lender.

What’s one tip you would give to members of underserved communities looking to get the best mortgage rate possible?

Remember that the loan with the lowest interest rate is not always the least expensive. You also have to consider the up-front fees the lender is charging. Look carefully at the Loan Estimate and make sure you understand all of the fees it lists. Your lender should be willing to take all the time you need to help explain it all to you.

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If you plan on keeping the loan for a long time (more than 6 or 7 years), the APR listed on this disclosure is a good measure of the loan’s true cost. On the other hand, if you anticipate moving in less than 5 years, you probably want to choose a loan with as few up-front fees as possible even if the APR is higher.

Finally, after you choose a lender and you are getting ready to close your loan, make sure you carefully review the Closing Disclosure you receive from your lender. Compare it with the original Loan Estimate and make sure you understand any differences. Once again, your lender should be willing to talk this through with you if you have any questions (another reason it is good to have a local lender).

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