If you’re planning to purchase a home now or in the future, you’re going to make a decision that comes down the age-old debate of lender vs. bank. Understanding the differences between getting your mortgage through each type of lender and bank will prove worthwhile in terms of finding yourself a smooth, affordable, and satisfactory transaction.
In general, when a borrower has a poor mortgage process experience, it comes down to having a slow, irritating, or bumpy road with respect to the loan’s close. According to The Mortgage Reports' Kyle Hiscock, mortgage lenders (vs. banks) tend to close at least 33% faster. Poli Mortgage, for example, has an average time from application to cleared to close of 20 days, whereas banks can take on average 45-60 days.
Lenders, such as us, have the flexibility and ability to do just about everything in house – from taking the application, to processing, to underwriting, and closing your loan. While any loan is subject to a multitude of complications, the speed of lenders is generally better here. Working with a lender who if flexible and has proven experience to close loans quickly and efficiently will save you a lot of headache in the end.
Rates and Costs
Generally speaking, banks have a lot of influence over the rates and costs within the mortgage industry. This is why the lender vs. bank debate is tricky, as this can serve as a pro in unique circumstances such as a borrower needing an exception made for his or her mortgage, and a con because the banks often have higher rates and closing costs because that is how their business model is setup. Anyone can offer a low rate, but it’s about understanding what the cost is to get that low rate.
Here at Poli, we've built a business model to reduce the extra expenses that lenders such as banks have to incur. This has allowed us to not only offer lower mortgage rates, but also keep the costs to get those rates low as well. Consider taking the time for yourself to compare mortgage quotes and costs of various banks and lenders. Often times, you’ll find that lenders can offer you more affordable options.
Convenience & Flexibility
Getting your mortgage through a bank limits you to the rates they offer and the specific types of programs they have available. However, working with a lender may open you up to getting lower rates and the unique loan program that is going to work best for you and your financial situation. Lenders, such as Poli Mortgage, have already done the “shopping” for you to offer you the best rates from banks and investors. Plus, our long-lasting relationships with banks and investors have allowed us to get our borrowers some of the best rates in the industry.
Also, working with a lender will typically give you a number of different loan options, so you can find the one that is going to work best for you. Remember – getting a mortgage isn’t just about getting the lowest rate, it’s about getting into a loan program that is going to work for your specific financial situation and you feel comfortable with.
Are you still unsure of the lender vs. bank debate? Want to learn more about the advantages and disadvantages of getting your mortgage from a bank or a lender? Poli Mortgage Group’s team of loans officers is experts in home financing—and they are here to help you, not sell you. Give us a call at 866-353-7654 so we can examine your situation and make you aware of the best possible course of action regarding your mortgage.