If it is your first home purchase, your foremost concern is where to apply for a house loan or which mortgage lender will be suitable to assist your need to purchase a house. Part of your research must concentrate on understanding the various types of mortgage lenders and how they operate.
First time home-buyer programs that are promoted in the market in collaboration by the local government are most often handled by mortgage banks because they have the financial strength to finance these programs and are experienced in dealing with current market value of residential homes at low interest, fixed rates. One of the observations found in mortgage banks is that due to its economic capacity to be able to finance mortgage loans, they are confronted with so many loan applications which take time to be approved as they are strict with the loan requirements. Sometimes, in cases where loan applications are disapproved, mortgage banks will courteously provide referral information to where you can seek applications in other lending institutions.
Another type of mortgage lender is called a portfolio lender or better known as a savings and loans lending institution. While it is much faster to get a mortgage loan from a portfolio lender, however, having a good track record of your savings and income capacity are salient for them to qualify you for a loan. Since portfolio lenders do not provide fixed rates, their loans are not cut-throat rates as that from mortgage bankers. Take note that there are also lending institutions that function as both mortgage bank and savings and loans at the same time.
Because, in reality, most house loans are not easily obtained, this is where the networking skill and expertise of a mortgage broker company come in, as its job is into regular negotiations between wholesale lenders and loan officers. Mortgage brokers have these advantages: they have the knowledge as to which company you can better apply for a house loan, portfolio lender or mortgage banker, and they know how to put together again your loan in a different strategy and submit it to another lending company.
A recent trend, nowadays, is for real estate companies, including builders, to own their own mortgage company, which may be favorable for first-time homeowners but the business arrangements here is rather controlled by the real estate company and, thus, expect greater profit from them. The best advise for house loan applicants is to be more vigilant in understanding the offers provided by these companies and, in this manner, securing a better, reasonable interest rate at lower cost.