4 Reasons to Choose a Local Mortgage Lender (2024)

FAQs

Why choose a local mortgage lender? ›

Local lenders have a much better understanding of the local market, are able to make decisions locally, offer personalized service, and typically have access to a variety of loan options. Learn more about DCCU mortgage options here.

Local lenders often provide more personalized attention and better customer service. You can probably meet your loan officer face-to-face if you'd like, but either way you'll be able to take advantage of their expertise to help guide you through the mortgage process while addressing your specific needs.

Private Real Estate Loans

Private lenders for mortgages base their offerings on hard assets – real estate in this case – and can deliver flexible terms, much shorter loan terms than what you'll find with traditional lenders. They'll also have higher loan amounts than what some lenders may be comfortable offering.

Due to their smaller size, local banks have the ability to customize their services. You'll also have access to real people to help you when you need it. Branches are conveniently located to make using them easier. Local bank officers are usually on site, but large bank CEOs can be hundreds of miles away.

The benefits of selecting a local lender are many. After you apply, the loan underwriting tends to be a lot quicker. That is because they have a deep understanding of the markets they serve and use this information to help you. Plus, local lenders tend to offer better rates as well as other types of financial services.

Banks tend to be a solid pick for established borrowers with a positive credit history. Perks tend to include lower rates and more customer service options. Private lenders can be a great choice for borrowers who need funds fast. If you need more lenient approval for whatever reason, this may be an option to explore.

Convenience and Accessibility

When moving to a new city, take into account the proximity and convenience of your bank's branches and ATMs. Having a local branch nearby can be beneficial for several reasons, including in-person customer service, ease of making cash deposits or withdrawals, and no ATM fees.

One of the main reasons that lenders are better than banks for a mortgage is that they offer a more flexible and personalized approach to lending. Lenders typically work with a variety of different banks and financial institutions to find the best mortgage products for their clients.

Is it cheaper to get a loan through your bank? ›

Cons of Personal Loans from Banks

Higher interest rates and fees: Banks tend to charge higher interest rates and more fees compared to their credit union and online lender counterparts. 12 If you don't qualify for a discount rate, you might end up paying more through a bank than you would with another lender.

Federal student loans usually have lower, fixed interest rates that stay the same for the duration of the loan. Private student loans can have either fixed rates that stay the same or variable rates that can change over time. It's important to understand the different interest rates and how they will impact your loan.

Local expertise

Besides knowing the area and local real estate market, a local lender will appear more attractive to certain home sellers and real estate agents because of the importance of a timely closing and a smooth process.

Going directly to a lender

If you feel comfortable shopping around, going directly to the source—whether it's a bank, credit union, or mortgage company—could be the better option for you. Going directly to a lender has some advantages: You can be as hands-on as you want to be in finding the right deal for you.

A mortgage broker nowadays can do most of what they need to do either on the telephone or online so it is completely irrelevant where the mortgage broker is based and they don't need to based near the properties that you are buying, simple as.