I have had past clients use these online loan brokers...with the other question you asked, I imagine you are not a first time buyer and have a bit more knowledge with regard to what to expect when you obtain a home loan. If you know what you are looking at, and are considering E-loan, I would also work with a local loan officer or two so you have a basis for comparison.
My experiences with online brokers tell me they do not fully inform the consumer. May not be true in all cases, but I like buyers to be well informed before they sign on the dotted line.
One big difference between a lccal business that depends almost completely on referrals from past customers and any business that depends mainly on advertising (and its internet presence) is that the referral based business will die if it does not provide good service at competitive cost.
Some businesses that constantly refresh their new customer base through advertising think they can afford to lose a few customers and missed referral opportunities. That attitude may also be damaging to the advertising based business in the very long run.
This may help explain why Carrie, Patti, Erin and Deborah feel their customers have had better experiences with local mortgage brokers that thrive on personal referrals.
Definitely do your research and make sure to ask a lot of questions. In the current market, the loan products that are available today, may not be available tomorrow and you want to be represented by a lender that can provide the right loan to fit your needs.
If you need any referrals for lenders, I know a few that are very reputable.
This is too important and far reaching of a decision. Go with someone local!
I once had an internet based lender actually tell me, after too many calls to him unreturned, "I have no idea when you'll have loan documents"!! I told him, "You sir, are either the dumbest lender I've ever met or the MOST honest!" He was the former! The client who finally got the loan through this company ended up with the wrong loan, huge pre-payment penalty (YSP working here!) and has since lost there home through foreclosure. I don't trust any of them. 'Nuff Said?
Again Ann, please make sure you satisfy yourself with regard to what your loan officer is truly setting you up with (fees, rates, etc.), whether that person is local or in cyber space...
I think internet lenders are a good source to check rates. Many local lenders will actually lower their rates if you can bring a bona fide rate quote from another lender. They are also a good source for niche products - unusual loans that a local bank can't offer, or for which they are not competitive.
If you are able to get the same rates, and same loan structure, from your local lender, than hands down go with the local lender. IMHO.
The biggest problem that I have seen with internet lenders is that if they don't do a lot of business in your area, they don't have attorneys that have worked with them before and this can cause delays. Many times their documentation does not comply with state requirements and the local attorney does not know the internet bank's documentation. It can be fixed but it causes delays.
Ann, would you perform your own surgery on yourself to save some $$, or use a local clinic when your condition requires a more skilled surgeon? I already know the answer to this question....
There are so many details involved in getting a loan successfully to the finish line, many related to the chosen property and type of sale, it's not just about having sufficient fico scores, income and closing funds...
Using a local pro is like hiring a specialist for your surgery....sure, it might cost a little more but it could easily mean the difference between a successful closing and one that falls apart....
Lastly, before deciding to hire ANY lending source, do some research! For internet lenders, make sure you look up their complaints on Consumer Affairs...for local, licensed loan officers, check out the CA DRE and/or NMLS...
Let me know if you'd any more information along these lines!
Best regards, Jeff Marr
I've had clients who've had great experiences with eLoan and other online loan companies, and I have clients who've had lousy experiences.
If you wanted me to refer some of the lenders I use so you can compare, please feel free to give me a call at (530) 672-9160. I can't get referral fees from lenders by law, so this is strictly so you can have the info.
In my particular case, when I sought a niche loan product, which by default is for a more experienced borrower, they were able to deliver and price much better than my local lenders. Obviously, I negotiated the loan in entirety and read ALL documentation upfront before they even got an application fee. It went great. The second time around - it was disastrous. Things had shifted in the credit market and they were not on top of this. Finally, I went to a local lender and did the loan.
The only time I have ever been burned on a loan i.e. misled with undisclosed fees and penalties: it was a local lender. Since we had previously done business, I trusted him. He delayed the loan until I was jammed and pretty much had to close. He did not give me the documentation until loan closing, and it was a shock. This would never have happened with any other lender - I would have been all over this. It was the one time I did not due my homework and I paid dearly for it. (So did he in future business and referrals.)
The moral of the story: No matter who the lender, do your homework. Get a good faith estimate. Read your loan docs and really understand the structure.