Posted on: 24th Mar, 2008 12:58 pm
I am looking to get a mortgage and I am wondering how I should figure out which lender I should go with. I have been calling for the past few weeks to get rates for mortgages. They are always changing and one week Citibank offers the best rate and the next week its Chase. How do I know which bank to go with when it could be 30-60 days from the day I get my pre-approval to the day I sign my contract? I am not asking for a recommendation on specific lenders. I am just trying to understand the process a little bit better. How do I know who to get my Pre-approval from if I won't have my rate locked for 1 or 2 months?
Should I just pick any bank and get my pre-approval?
Should I just pick any bank and get my pre-approval?
Hi mambwe,
Welcome to the forum.
The rates are changing all the time. So I think it is better to lock the rate when ever you are offered a good and affordable rates and term. You can take the mortgage from any good bank or even from lenders
Feel free to ask if you have any further questions.
Best of luck,
Larry
Welcome to the forum.
The rates are changing all the time. So I think it is better to lock the rate when ever you are offered a good and affordable rates and term. You can take the mortgage from any good bank or even from lenders
Feel free to ask if you have any further questions.
Best of luck,
Larry
I guess my question is this: Is getting a pre-approval just a formality to make an offer on a house? Then when it comes to time to actually get a mortgage you shop around to get the best rates and you don't necessarily use the bank who you got the pre-approval from?
Almost everything I have been reading states the a buyer with a Pre-approval is at an advantage to one with only a pre-qualification.
What I don't understand is this; If I go today and get a pre-approval from Citimortgage and it takes me 30 days to find the house I finally want to make an offer on. In those 30 days, Chase could have better rates for me than Citimortgage to lock. Do I then go through the whole approval process over again with Chase to get those better rates? A couple of banks have told me that you can't lock rates until you sign a contract. So, if I don't know what the rates will be in 30 days, what is the point of shopping around now for a lender when they might have the second best deal when I need to lock my rate?
Or,
Do you only get a pre-approval after you have already placed a bid and it was accepted? I believe this is what Samantha saying.
I hope this is all making sense. It all just seems like a huge waste of time and paper to me.
What I don't understand is this; If I go today and get a pre-approval from Citimortgage and it takes me 30 days to find the house I finally want to make an offer on. In those 30 days, Chase could have better rates for me than Citimortgage to lock. Do I then go through the whole approval process over again with Chase to get those better rates? A couple of banks have told me that you can't lock rates until you sign a contract. So, if I don't know what the rates will be in 30 days, what is the point of shopping around now for a lender when they might have the second best deal when I need to lock my rate?
Or,
Do you only get a pre-approval after you have already placed a bid and it was accepted? I believe this is what Samantha saying.
I hope this is all making sense. It all just seems like a huge waste of time and paper to me.
First timer in searching for a pre-approval you have many resources to find a good reputable lender. I am obligated to say start here on this form where you can shop an compare lenders. But my professional opinion is to tell you to first ask a trusted relative who would they recommend. In all things due your DUE DILIGENCE, interest rate in this market is very volatile you can maintain a preapproval for a 120 days but you can only maintain a rate lock for 30 days. Before you get to allowing every lender you meet pull your credit order your own copy with all three scores and ask questions. Come back to this forum when you are truly ready and one of us will help you through the process and will lock you at the best rate available that will fill the need of your current credit situation. Learn to screen your loan officer, ask them questions "like how is the 30 Year Mortgage rates established" or How frequently can I expect to receive updates from you about the status of my loan? Good Luck and come-back! Executive Mortgage Advisor
When you get pre-qualified, you are not locked into an interest rate. you are pre-qualified and a specific rate and verbal information (income assets, etc). When you have a contact on a property, then you can lock the interest rate and supply your lender/ broker with your documentation. The pre-qualification letter can give you some strength when placing an offer on a home especially when there are multiple offers. Many Realtors require you to be pre-qualified before they start showing you homes. Personally, I issue pre-qualification letters for the exact price the buyer is offering. You don't want the seller to know you could qualify for more home especially if your offer less than the listed price.
Hello Mambwe,
I would agree with all the previous postes on this Thread, If you go to a reputable lender and get a floating preapproval you have a better chance of negotiating the price of your home as the Seller can see you mean business. In regards to the Rates offered by Most lenders, In all honesty barring promotions, all big reputable lenders are usually within reach of each other and will compete for your business. I recommend do your dilligence on the Lenders, Pick the one you are most comfortable with and get a pre approval. Once you have found a home and written a contract you can Shop around different Lenders to find the best deal and even have the Original Lender compete. Once a Lender approves you they will not like to let you go and most have Price Matching Policies. I know I do at bank of America.
I would agree with all the previous postes on this Thread, If you go to a reputable lender and get a floating preapproval you have a better chance of negotiating the price of your home as the Seller can see you mean business. In regards to the Rates offered by Most lenders, In all honesty barring promotions, all big reputable lenders are usually within reach of each other and will compete for your business. I recommend do your dilligence on the Lenders, Pick the one you are most comfortable with and get a pre approval. Once you have found a home and written a contract you can Shop around different Lenders to find the best deal and even have the Original Lender compete. Once a Lender approves you they will not like to let you go and most have Price Matching Policies. I know I do at bank of America.
Hi John and Atul,
I agree with you all. It's important that a person gets prequalified as it helps him judge whether he's actually financially strong enough to manage a mortgage.
Atul, a warm welcome to you from our community :) Well, I think it's worth considering that one should make one lender compete against the other. Chances are one might get a better rate out of such a scenario.
Good luck
I agree with you all. It's important that a person gets prequalified as it helps him judge whether he's actually financially strong enough to manage a mortgage.
Atul, a warm welcome to you from our community :) Well, I think it's worth considering that one should make one lender compete against the other. Chances are one might get a better rate out of such a scenario.
Good luck
one word about prequalifying and then shopping around - i think it is an injustice to most of us that issue preapproval letters when a borrower then makes a concerted effort to "get the best rate."
please understand that i dont think anyone should have to pay more than the best available rate; but the time invested in prequalifying, counseling, etc. ought to count for something. if citi tells you what you're approved for, that should be the first stop when a contract is being signed. if chase has a better rate, citi ought to have the option to equal the rate (and of course, payment for service is not really quantifiable - the service you get from a loan officer can easily negate the dollars spent in your quest).
here's hoping that there exists an iota of loyalty to the first person in line who took the time to review the qualifying data and churned out a letter verifying that everything meets guidelines and that a realtor could count on a preapproval.
please understand that i dont think anyone should have to pay more than the best available rate; but the time invested in prequalifying, counseling, etc. ought to count for something. if citi tells you what you're approved for, that should be the first stop when a contract is being signed. if chase has a better rate, citi ought to have the option to equal the rate (and of course, payment for service is not really quantifiable - the service you get from a loan officer can easily negate the dollars spent in your quest).
here's hoping that there exists an iota of loyalty to the first person in line who took the time to review the qualifying data and churned out a letter verifying that everything meets guidelines and that a realtor could count on a preapproval.
