Types of Mortgage Lenders

When entering the mortgage marketplace, you should know that you have
several lending alternatives. Below you will find descriptions of three
common ones:
1. Retail Lenders
The first option is your most basic type of lender: retail lenders. At
these “corner banks” you can deal face to face with a representative
who will take your application and then determine if your profile fits
their guidelines. Although usually loans obtained in this manner have
the lowest closing costs, these lenders usually have rigid approval
criteria.
2. Wholesale Lenders
By using a mortgage broker, you can gain access to a wide variety of
wholesale lenders that offer countless loan programs. Although you do
not meet your lender face to face this way, this is typically the best
way to go if you have less than perfect credit or no down payment
money. You will, of course, want to get many quotes when going this
route to ensure that you do not pay excessive closing costs.
3. Hard Money Lenders
If you do not fit the requirements for the previous options, you may
need to consider something more drastic: hard money lending. Equity and
asset based, these lenders loan you money from their own investments at
high interest rates. This route should only be used in extreme
circumstances, like staving off a sheriff’s sale, and you should only
keep the loans long enough to improve your rating for something better.
Although not the best alternative, these lenders can buy you time to
make positive changes in your financial life.
The important thing to understand is that you always have more than one
option when seeking a mortgage loan. To begin, you must assess your own
credentials to figure out which of these option suits your particular
needs.
Preferred Mortgage Lenders - We maintain a list of recommended mortgage
companies online and update the list regularly.
Poor Credit? See a List of Lenders Specializing in Borrowers with Poor
Credit
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