The Smart Way To Shop For A Fort Myers Mortgage Lender

There is a huge misconception among Fort Myers homebuyers that the best lender is the one who offers a product with the lowest interest rate. Here is why this may not be the case:

• The rates advertised may not apply to the loan product you want.
• The true Annual Percentage Rate (APR) may be higher – a lot higher.
• Bait & Switch is still alive and well in the mortgage industry.

Although we aren’t finance experts, our best advice is to shop by comparing each company’s APR. This is because this figure reflects the annual percentage rate with points and fees included. We’ll get deeper into this in a moment.

The best place to start when shopping for a mortgage lender in Fort Myers is contacting a local mortgage broker. Even though you may have been banking with [insert large national bank name here] for a long time, they are unlikley to provide the best rates and I know from experience they won't provide anywhere near the best service. When a listing agent is reviewing two similar offers, one of which is from a large bank and one is from a local lender, the offer with the local lender almost always wins out. As an agent, I like to know that my calls will be answered or returned and if they aren't, I can drive over to the local mortgage broker's office and get an answer but if your file is sitting on someone's desk in Charlotte or Detroit, there's not much I can do.

What about an online lender? Skip back up to the previous paragraph and swap out [insert large national bank name here] for AnyMortgageCompany.com. Big national banks and online lenders should be avoided at all costs.

When you call or visit lenders in Fort Myers, look into the following aspects of their loan products:

• Request the lender’s current interest rates and ask if these rates are the lowest for just that day or for the week and if the rates quoted are for adjustable or fixed mortgages.
• If you are interested in an adjustable-rate mortgage, ask when the rates will increase, how the rate and payments will vary and whether or not payments will decrease with a reduction in rates.
• Ask the lender for the loan’s APR, which, as mentioned earlier, is a figure that represents the yearly rate and includes points, fees and other charges.
• Request that the lender or mortgage broker express the points as a dollar amount. This will make it easier to determine exactly how much you’ll be paying for the quoted loan and easier to compare it to other offers.
• Fees are sometimes lumped together under one category. Ask the broker or lender to separate them so that you can compare the fees associated with this loan to other loans. Ask for clarification for any fee you don’t understand

If you won’t be using an FHA, USDA or VA loan, find out how much the lender requires as a down payment. Also ask if Private Mortgage Insurance (PMI) is required and, if so, how much the premium will increase your monthly mortgage payment.

As of August, 2015, the Good Faith Estimate (GFE) form that the lender is required to supply to a borrower has been replaced with the Loan Estimate and Closing Disclosure. This form still itemizes the loan’s terms and fees but it goes into more detail and is easier for consumers to understand than the old standardized forms.

The Closing Disclosure must be given to the borrower three days before closing.

The Mortgage Process

Here’s what to expect during the mortgage process:

• Fill out and submit the loan application.
• Your loan package goes to the processing department where all the information is verified.
• Your package is sent to the underwriter, who decides whether or not to approve the loan. If the underwriter approves your loan, you will be sent a commitment letter.

These are just the typical steps in the process and no two applicants are the same so your exact mortgage application process may vary.

Since we've been in the Fort Myers real estate business for so long, we have a list of prefered lenders that we would love to share with you. These are lenders that we know take excellent care of clients and the only thing we get in return is a job well done. Please feel free to reach out and we can send you the list.