As a mortgage loan officer for over 18 years I have seen both sides of the entire loan mortgage process from beginning to end with a larger lending institution like Bank of America, Wells Fargo and Chase and with smaller lending institutions like us here at Fellowship Home Loans. Here are some of the main reasons why potential new homebuyers or homeowners who are looking to refinance their mortgage should go with a smaller bank VS. larger one.
1. Lower Rates and Fees
Smaller mortgage lenders offer the same variety of products as larger banks, and sometimes you can take advantage of these products at a lower cost. We don’t have the same overhead expenses and costs that these larger banks have because they have over 100 local branches and several thousand employees. Mortgage rates and closing costs vary from lender to lender with small lenders offering competitive—sometimes better interest rates and closing costs. A lower interest rate can save you thousands over the life of a 30-year mortgage, and lower fees result in fewer upfront costs.
2. Faster Response Time
Big banks have a large mortgage department and these financial institutions can receive thousands of home loan applications a week. That’s a lot of paperwork to sift through, and it can take loan officers and underwriters several days to review documents and get in touch with applicants. Smaller lenders typically have a faster response time. While a bigger lender may forward applications to another mortgage department or branch, small lenders make many of their decisions in-house. The person who receives your application may be the final decision maker.
It’s often easier to work one-on-one with the underwriter at a smaller bank. You can experience a higher level of personal attention and assistance, which is important if you need advice on how to turn a mortgage rejection into an acceptance, or if you need advice on qualifying for a better mortgage rate.
We are more accessible than larger banks as most of the larger banks will have their borrowers call into #1-800 toll free phone number and you won’t necessarily speak to the same person through the process. With Fellowship Home Loans, you will work with one assigned loan officer and their own processing team who will just work on your loan file and ensure it gets approved and closed in a timely matter.
3. Flexibility with Lending
The guidelines for getting approved for a mortgage with a big bank are pretty much written in stone and there’s very little you can do to change the rules. There’s an established minimum criteria, and applicants who don’t meet this criteria can’t qualify for a loan.
Small lenders, however, can often approve mortgages that have been rejected by larger banks. This is because their guidelines and criteria differ. This gives small lenders the ability to relax their guidelines and approve borrowers who don’t qualify elsewhere, perhaps due to bad credit or irregular income. A borrower may have a low FICO score, but enough assets and income to support mortgage payments.
4. We share Christian Values
We always do the right thing here at Fellowship Home Loans. With bigger banks, they always look at the bottom line of profits, and not necessarily look at the consumer. From gathering your personal information in a safe and secure matter we don’t share our borrower’s personal information. Our experienced loan officers will help educate our first time buyers and hold their hand throughout the process of obtaining a new home mortgage. We will work tirelessly to obtain the best loan for our borrowers needs and offer several possible loan options. We treat our borrower like we would want to be treated.