Mortgage Shopping in Today’s World
April 4th, 2016 by Bunch & Brock
Buying a home is neither easy nor cheap. At one time a great investment, the “American dream” of home ownership became a bit of a nightmare during the subprime mortgage crisis of 2008. The mortgage market has been moving in a favorable direction since then, with interest rates falling, banks lending, and consumer confidence increasing. Technically, mortgages are the written agreements that govern home loans between banks/lenders and consumers/borrowers. Of course, the banks are lending the money for a profit, so it’s important to make sure you shop around for the best deal.
For 2013, Kentucky ranked 31st nationwide in mortgage lending volume. Our top five lenders were Reverse Mortgage Solutions Inc, Wells Fargo Bank NA, JPMorgan Chase Bank NA, US Bank NA, and Fifth Third Mortgage Co. There are thousands more, though the number of active mortgage originators has been declining. As with all big purchases, it’s important to shop around and compare lenders before selecting one. Consumers who consider interest rates offered by multiple lenders can see substantial differences in the rates; differences that can really add up in savings over time.
If you believe a controversial ad that first aired recently during the Super Bowl, getting a great mortgage is as easy as “pushing a button.” Quicken Loans claims that the ad was intended to promote the convenience of their new product “Rocket Mortgage,” which enables consumers to get a mortgage completely online, including by mobile phone. Approval can supposedly be given in as few as eight minutes. What some people saw instead was an irresponsible ad promoting a lending environment similar to the years leading up to the housing crash and the Great Recession. The Consumer Financial Protection Bureau, which was established by the government in response to the 2008 crisis, responded by encouraging home buyers to take their time and ask questions during the mortgage process.
Certainly, to be competitive in today’s world, businesses have to have a user-friendly website and active social media presence. But consumers need to take all that flash with a grain of salt and take time to consider what they are getting into. Don’t believe the often repeated myth that it’s better to stick with just one lender because having several mortgage lenders run your credit can hurt your FICO score. The truth is that multiple credit inquiries made by mortgage lenders within 30 days will not impact your score.
The mortgage rate attorneys at Bunch & Brock know it can be hard to find the best path on the road to home ownership, but with more than 35 years of experience in the state of Kentucky, we have helped many people who were struggling with these very issues. If you wish to learn more about how our firm can be of assistance to you, or you want to learn more about this topic, we encourage you to contact us by calling 859-254-5522 or filling out this online form.