Using a Local Lender: Why It’s So Important
As a house hunter seeking a mortgage, you have probably heard time and again about the importance of using a local lender. Why is everyone telling you this? Allow us to explain.
You may be tempted to use your existing bank or credit union or even an online lender to secure your home loan. DON’T! Trust us on this one! We’ve seen larger lenders who don’t do a lot of business in our area derail many a deal. Here are some reasons why you should be using a local lender when buying a home.
The Benefits of Using a Local Lender
- Sellers and listing agents typically prefer when buyers use local lenders. They know the norms of our market. If you’re in a competitive situation, using a respected local lender may just tip the scales in your favor.
- In the DC area, lenders are typically reachable on weekends and evenings. In other markets, lenders very much follow a 9-5 schedule, which doesn’t usually align with househunters’ and Realtors’ schedules.
- It’s tremendously helpful when lenders are in your same time zone. A three-hour delay from a west coast lender can cause you to miss important deadlines. We have seen lenders in different time zones cause major issues for our buyers!
- Your lender will provide you with estimates of closing costs, which can vary greatly from one state or jurisdiction to the next. Even between Virginia and the District, closing costs and taxes vary widely. For this reason, it’s always wise to work with a lender who is familiar with the numbers in your jurisdiction.
- A local lender’s underwriting and processing of the loan is also local. It is much easier for everyone when loan processors and underwriters are local as well, as they also understand our market’s quirks. Large lenders have consolidated operations in a west coast team with no knowledge of the DC market is underwriting and processing your loan. Additionally, larger lenders aren’t able to provide continuity of service. As each new piece of documentation comes in, a different processor or underwriter attaches it to the file and someone else reviews it. A local lender is with your loan from contract to close.
- A lender in your market will use local appraisers for your property’s appraisal which can make an enormous difference in the end result. An appraiser with knowledge of the local market will provide the best and most accurate value of the property.
- Local lenders often attend closings personally to make sure all questions are answered and the process is smooth, providing a level of comfort that is not possible with a long distance or Internet lender. In fact, your lender often becomes a long-term advisor in your home-related financial matters.
- Local lenders depend on Realtors in their community to keep them in business. They have a vested interest in keeping us (and you) happy. We see our often our lenders at school and community events — even in the grocery store. These folks want to stay on our good side!
THE BOTTOM LINE
This is an easy one! Using a local lender when buying a new home with a mortgage is key. You and your Realtor will be very glad that you did. A local lender will go the extra mile to keep you happy and see you through to a smooth and successful settlement.
Ready to get started? Contact us today!
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