Many people don’t realize it, but there are actually several options available to those who are looking for a mortgage lender. Aside from the traditional mortgage brokers and commercial banks, here is a look at a couple of the less traditional options available.
Private Individual
The simple reality is that anyone who has enough money in the bank can serve as a mortgage lender, so long as they abide by all of the federal and state regulations that go into making such a loan. This includes meeting guidelines associated with charging interest rates and fees as well as providing all of the disclosures that are require by law.
When obtaining a mortgage loan through a private individual, there are a few things you need to keep in mind. First, although the lender may not require you to obtain an appraisal or a title policy, it is in your best interest to obtain an appraisal as well as title protection in order to keep yourself protected. After all, one of the reasons for obtaining an appraisal is to prevent the buyer from paying more money than necessary on a home.
There are several avenues you can pursue in order to obtain a loan through a private lender. If you have a wealthy friend or family member, he or she may be willing to provide you with a loan. Furthermore, some wealthy individuals offer private loans as a side business that allows them to make a little extra money off of their income. In addition, if you are purchasing the home directly from a seller, he or she may be willing to allow you to finance your payments directly. Keep in mind, however, that this situation works out best when the property is free and clear from any other loans. Otherwise, it may contain an alienation clause that could further complicate matters.
Stock Brokerages and Online Companies
Many stock brokerages do more than just handle IRAs and mutual funds – many of them also offer mortgage loans. A few examples include Ditech, HFC Home Loans, Charles Schwab and INGDirect. The Internet is also a great resource for finding a mortgage lender. Of course, if you are the type of person that needs to meet directly with a lender, then obtaining a loan online isn’t right for you. If you are comfortable with using the Internet, however, this can be a great option. This is also a good option for those who have a great FICO, as this minimizes the amount of paperwork necessary and your loan can be approved quickly. Just be sure to contact only a known and reputable online lender who conducts business over a secure Website.
While there is certainly nothing wrong with taking a more traditional avenue toward obtaining a home mortgage loan, it is also a good idea to explore alternative options. By exploring all of the options available to you, you will be more likely to find the rate and terms that are best suited to your lifestyle and needs.
Ryan Lynch is part of the marketing team for an Austin Mortgage lender: http://www.maxleaman.com/ and a group of Austin Realtors: http://www.jimolenbush.com/ that proudly serve the capitol city. Their office is conveniently located in West Austin and they are ready to help.
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