People constantly ask me if a particular lender is good, bad, or should be avoided at all costs.
And my answer is pretty much always the same – it depends on how your loan goes. You might end up hating the company or loving it, all based on how things go when it’s your turn.
So yes, two individuals can wind up with completely different opinions, even when working with the same company, and perhaps the same exact employees.
The problem with the mortgage industry is that it’s very dynamic and complex, and as such, it’s very difficult to please everyone all of the time, even with the best of intentions.
In other industries, such as the credit card industry for example, customer service reps can “make things right” if something goes wrong, usually just by pushing a button.
The same goes for your cable company, who you have to call each month to ask for a billing adjustment after they attempt to gouge you.
Aligning Expectations with Reality
Unfortunately, it is these very companies that create lofty expectations for all other businesses, whether they can live up to them or not.
So when a consumer applies for a mortgage, they often go into it thinking they can complain if anything goes wrong and automatically get it fixed. Or simply argue until fees are lowered or waived, and the interest rate reduced.
Sadly, it’s not so simple when it comes to mortgage lending. There are so many hands involved in a single loan, and so many guidelines that must be met. Many are black and white, and not up to your lender.
There are also many technical aspects, and mortgage pricing is very involved. Sure, some junk fees might be waived without too much of a fight, but adjusting your mortgage rate lower will be a lot trickier.
If you’re not a great borrower, even the best lender won’t be able to get you the low advertised rate you see on TV.
You know the old adage, “the customer is always right.” In mortgage, this doesn’t necessarily hold true, as you and your lender will be at the mercy of external forces.
Enter frustration here.
Complications Come Off as Lies
Let’s take a common scenario, where you are quoted a certain mortgage rate at the beginning of the loan process.
It is at this very moment the lender gets you in the door. After all, without the promise of a low mortgage rate, why would you choose them? They must be somewhat competitive to move forward.
You have a great conversation with the loan officer and feel really good about everything.
The fees are explained in detail, and the rate you’re set to receive is going to shave hundreds off your monthly mortgage payment!
Then, out of nowhere, you’re told your mortgage rate will be .50% higher than originally quoted.
Turns out something came up on your credit report that wasn’t originally disclosed, pushing your credit score into a lower tier, and thus raising your rate.
This is but one example of how rates can change in a flash, and it has nothing to do with the lender originating your loan. It’s not a bait and switch.
Once again, this has nothing to do with the lender.
Or let’s just assume you decide to float your rate, only to see rates rise. You may blame the lender for not locking your rate early on. But the exact opposite could also happen, making you a very happy borrower.
Again, your lender is not the culprit here, but rather timing. So luck is involved as well, which as we all know, can go both ways.
You may also find out that your loan is declined after weeks of back and forth with your lender. Again, things come up, and the more documentation you provide to your lender, the more things can change.
Your mortgage doesn’t operate in a vacuum. If you send in a document that happens to raise a red flag with the underwriter, everything may change in a heartbeat.
Again, it’s not your lender in many cases, it’s just reality in the mortgage world.
Lenders are accountable for mistakes made during the loan process, and so yes, they may ask for a document more than once. Or a blank page that seems entirely insignificant.
And they may ask for an explanation. And they might ask for an explanation to your previous explanation.
But it’s all done for a reason. Lenders aren’t in business to play games with you. They want to fund loans just as much as you want yours funded.
There Are Exceptions
Just like any industry, there are bad apples among the good, and you do need to navigate extremely carefully to avoid such individuals.
This is especially important when obtaining a mortgage, as a bad deal can cost you a lot more than a bad deal elsewhere. Would you rather overpay for a car or your mortgage?
So ask a lot of questions, and make sure your loan rep takes the time to explain anything that might be causing confusion or concern. It is their job, and they should be more than willing to help you out.
In other words, YOU affect the outcome of your mortgage as well. Prepare, do your homework, and put in the time to ensure you don’t walk away disappointed.