Local Banker Vs. Online Lender

One of the top benefits of using a community bank is personal, face-to-face contact.

Today there are many options when applying for a mortgage loan. As Central Florida has expanded, so have the options of lenders in the area. In addition to local lenders, some applicants have started obtaining loan approvals without getting off their couch. However, this ease of access does not necessarily provide the best options for consumers. A local mortgage professional can guide buyers through the entire loan process and often help them avoid timely pitfalls that could delay the closing or even cost them the opportunity of getting the home of their dreams.

One of the top benefits of using a community bank is personal, face-to-face contact. Most realtors advise their clients to work with a local lender because they are available to the client almost any time to give detailed information throughout the entire process. Local lenders will sit down and explain in clear terms the conditions in the contract, scan documents to realtors, and keep the realtor updated on the status of the application. This allows buyer, realtor, and lender to work together as a team.

This accessible communication between the realtor, borrower, mortgage lender, title company, home inspector, appraiser, insurance agent and surveyor is crucial to having all components lined up and in harmony to complete the transaction.
By having a local lender, you can walk into his or her office and request any document or address any issues that might delay the loan. The lender is your advocate, working closely and coordinating with the network of professionals that will help get the loan closed.

Know Before You Owe
Next, use caution when shopping online for anything, especially for a home mortgage. “Buyer Beware” is just as relevant when looking for mortgages as it is when buying cars. While online lenders may appear to provide a fast, automatic approval, it does not mean the borrower can afford the home. The potential homebuyers may even receive a preapproval letter, but when they begin to complete the online application, they discover the terms are not what they initially thought they would be.

The information local lenders can give clients at prequalification will include estimated rate, payment and a good approximation of what their closing costs and
out-of-pocket money could be.

From my experiences working with clients who have searched online, most of them had no idea what their final costs would be. Consumers applying online should also be aware of application fees that cover credit checks, appraisals and other expenses. Understand that consumers should never have to pay any fees or deposits upfront to obtain a prequalification. Any legitimate mortgage expenses will not come until further along in the process, after a borrower has submitted an application and received a loan estimate.

The biggest thing local lenders can provide over online lenders is peace of mind during the home buying process. Buying a home is one of the largest purchases a person will make in his or her life, and it should be done with a local expert who can provide the knowledge and experience needed to ensure a successful closing occurs. Utilizing the trusted relationships local professionals have developed with each other ensures the borrower has the best experience possible. ◆

Joy Winslow is vice president of Residential Mortgage Lending at Fidelity Bank of Florida’s Merritt Island office. Winslow has more than 30 years of lending experience.