Did you know that LendingTree has a Ratings and Reviews section where users can leave feedback about their experiences with individual lenders? Not only can you tell your story as a narrative, but you can also award star ratings across five criteria:
- Mortgage rates
- Fees and closing costs
- Customer service
- Overall experience
The Best Lenders -- According to You
Given that LendingTree is America's leading online source for competitive home loan offers, this customer rating system has grown into an important consumer resource, allowing home buyers to learn from the real-life experiences of others just like them. On Sept. 10, the company released the names of the 10 lenders most highly rated during the second quarter of 2013:
- HomePlus Mortgage
- Pacific Beneficial Mortgage Company
- Affinity Mortgage, LLC
- Mortgage Loans for Texas
- BNC National Bank
- Mid America Mortgage Inc.
- Integrated Financial Group, Inc.
- Mortgage Lenders of America
- Southwest Direct Mortgage
The list is based on a weighted average of ratings and volume of feedback, so small and large lenders are assessed on a level playing field. Some have very few reviews, while others have more than a thousand.
If you're thinking of going with a lender that doesn't appear in the LendingTree Top 10, don't necessarily be put off. There are about 250 companies represented on the site, and many more than ten are extremely good. Check the star ratings and reviews for your candidate lenders so you can make an informed choice.
Rates Only One Factor
Many people focus exclusively on finding the lowest mortgage rates when they seek a loan. And that's often a good starting point. However, there are a number of other factors that need to be built into the equation.
Financially, closing costs and fees are the next most important. Some lenders offer the lowest ongoing rates only to borrowers who pay sky-high upfront costs. That's fine if you're cash-rich but income-poor, but most people need to balance continuing costs with initial ones. Don't forget: if you do have substantial savings and want to keep your monthly payments low, you can generally buy discount points on closing that drive down your rate even further.
Why Mortgage Lenders Matter
It doesn't matter how great a deal you've been offered; if your lender or broker drops the ball and the whole purchase falls apart, you're in trouble. And what if your refinance fails to close on time and you get stuck with a higher rate? Such events may be less rare than you think, especially when inexpert, inexperienced or inefficient people in your lender's or broker's offices are involved.
Expertise is an especially important -- and growing -- issue at the moment. In the wake of the credit crunch, new legislation was passed and a new regulator created to (hopefully) prevent another mortgage crash in the future. One result is an avalanche of new rules. Understandably, some operations have faced problems with keeping on top of the flow, but it may be you who suffers if you don't close on time.
Experience is equally important. Suppose some issue arises close to closing over the construction or legal status of the home you're buying. Or imagine how you'd feel if your lender suddenly uncovers a problem with your personal financial situation buried in the paperwork. In either of those circumstances, you stand a much better chance of moving forward again if you're working with a lender who's been round the block a few times and knows how to get around obstacles. Having someone experienced working on your behalf may also improve your chances of borrowing against hard-to-finance properties.
Avoid Dangerous Lenders
To have someone in your corner who knows how to work the system can be a big advantage. But lenders who offer to break rules can be dangerous. In particular, run a mile if anyone tells you:
- They can still get you the best rate even though you have serious credit issues.
- You should sign documents containing blank fields that they'll kindly fill in later.
- It's no problem if they falsify some information in legal documents on your behalf.
- You don't need independent advice over something you suspect is fishy.
- You should take advice from a housing counselor who isn't approved by the U.S. Department of Housing and Urban Development (HUD), or a credit counselor who isn't registered with a reputable association.
Some would argue that trustworthiness and honesty rank even higher than expertise, experience and efficiency when it comes to picking a lender or broker.
Good Lenders + Good Rates = Good Experience
In general, mortgage rates from the best lenders are quite competitive with those from the worst. All that's required of you is the small amount of time it takes to research the track records of the ones on your short list. And that's what LendingTree's Ratings and Reviews page is for.