Home Buying in 36830>Question Details

Eman, Home Buyer in Auburn, AL

I'm a 1st time home buyer and i need help with financing. Is it better to go with a bank or mortgage company?

Asked by Eman, Auburn, AL Thu Mar 12, 2009

I'm a first time home buyer and i need help with financing. Is it better to go with a bank or mortgage company? our credit is right under 700 but we want to imrove before going through the loan process.

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Shane Dunn’s answer
I think both have potential for you depending upon you needs. Banks tend to have slightly higher rates, but will take riskier loans... especially your local banks, while mortgage companies can offer more competitive rates. A positive to working with a local bank is that there underwriting department is usually located on site, so you can get quicker service. Mortgage companies also have a high level of customer service, but there may be a little longer lag time in there underwriting dept. due to a much higher level of processing they incur.

All in all, I would interview some of each and go with your gut! They all have competitive rates and may also offer you the opportunity to buy down your rate. Some lenders are even offering 100% financing again.

0 votes Thank Flag Link Sun May 19, 2013
I know that I am a little late but I want to know if you have your question answered and if you need any help?
0 votes Thank Flag Link Fri May 17, 2013
Good morning Eman,

First steps:

Meet with a Local Mortgage Banker to get prequalified for mortgage financing. The Mortgage Banker will review all facets of your loan request to answer your questions with regards to the types of loans and maximum loan amounts you could qualify for.

Line up a Home Inspector. A good home inspector will scare the heck out of you: that's what you pay him for! But you'll concentrate on the fundamentals of the property: roof free of leaks, plumbing, heating and electrical up to code and in good working order. Again, when you make an offer and you have your Home Inspector ready to go, your offer will be considered with much more interest by a Seller because you truly have your "ducks in a row" and your preparation demonstrates your serious attitude about conducting the purchase transaction in a timely manner.

Find an experienced Local Realtor who works in your desired shopping area. A serious pro Realtor will refuse to show you homes until you are Prequalified for mortgage financing. Don't take offense! That Realtor doesn't want you to be disappointed and wants you to have a smooth experience as you shop for your new home.

Put together your Team of real estate professionals and shop 'til you drop!

Trevor Curran
NMLS #40140

*If you thought my answer was helpful, please give me a “Thumbs Up” or “Best Answer.” Thanks!
0 votes Thank Flag Link Fri May 17, 2013
It is always best to go to whomever you trust most.... where you bank is an excellent start.... but also talk to any friends or relatives to get recommendations.....
0 votes Thank Flag Link Fri May 17, 2013

There are several bank and mortgage companies in Auburn. The best thing to do is call and check with
several ones. Some can even take your application over the phone where you don't even have to go
in. If you find out that you are qualified, I would love to help you find your next home. Call me or
e-mail me. My number is (334) 235-7463 or joymelton@elmore.rr.com
0 votes Thank Flag Link Wed Aug 5, 2009
Which ever you can get the best rate with and most important use the source with the person you trust the most and are most comfortable with, in the end its about being happy with your decision. Shop around and interview. Your mortgage will probably be sold anyway.
Scott Langley
RE/MAX Professional Partners
0 votes Thank Flag Link Tue Jun 16, 2009
There are a few really great loan programs available. You can get approved for an FHA loan with a credit score of 620 and 3.5% down. The rate is fixed and currently the rates are around 4.875%. Having a higher credit score won't get you a lower rate right now. There are also programs available to cover down payments. Banks tend to have lower fees than mortgage company's. They also offer loans with no private mortgage insurance which affects your payments over 20 years in some cases. Conventional loans are a little harder to get qualified for right now. You will need to have a credit score in the high 700's. That comes with 5% down and a few other extra fees. I really don't feel it is a good way to go for first time buyers because of the extra fees. There is also a great program through USDA if you are buying in a rural area. It is 100% financing.
I would love to discuss this with you further. My email is latarsha.hare@coldwellbanker.com.
0 votes Thank Flag Link Thu Mar 12, 2009
You can have the best of both worlds if you go to a knowlegeable Mortgage Broker who can go to many different banks for different products and rates. Ask if they are a Broker or just use a one bank lender.
0 votes Thank Flag Link Thu Mar 12, 2009
Depends. My buyers have success with both. I have some friends at Charter Bank, Auburn Bank, Compass Bank, as well as Countrywide & Wells Fargo. I can give you a list & you can "interview" all of them.
I would suggest that before letting them run credit.
There are positives and negatives for both. Whether you're going FHA, VA, or convetional, each has different programs. I would check out their websites (sorry spam rules - I can't give them to you). The ones that don't have websites you can drop by the locations and get a pamphlet explaining the current financing programs.
Here's a note to consider:
Banks sell their notes to lenders.
0 votes Thank Flag Link Thu Mar 12, 2009
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