This Is Why You Should Use a Local Lender When Buying a Home
In Support of Small Business Saturday
As we approach Small Business Saturday, I’m writing to encourage all homebuyers to consider shopping small when choosing a mortgage lender. Most people associate Small Business Saturday with small boutique stores, but there are tens of thousands of small banks, credit unions and mortgage companies across America that offer better products, lower interest rates and higher quality service than their large national counterparts.
Prior to co-founding Own Up, I was an Executive at community bank just outside of Boston. It’s there that I learned first-hand how these institutions work and what distinguishes them from large national lenders. At Own Up, we secure homebuyers financing from a network of local lenders to ensure that they will be approved and to save them tens of thousands of dollars.
The transgressionsof national mortgage lenders has been well chronicled. Here are just a few examples of recent lawsuits filed against Wells Fargo, Bank of America and Quicken Loans. However, the purpose of this article is not to discuss the inadequacies of national lenders (most people are well aware of those), but to highlight the advantages of using local community lenders to secure your home mortgage.
Here is a list of the most important benefits:
Customers are treated like real people — A small lender has thousands of customers, not millions. Therefore, each and every customer is more meaningful. At a community lender you are more than an account number, you’re a person trying to buy a home.
Commonsense Underwriting — Every borrower is unique, every property has its flaws and every loan scenario comes with its challenges. Local lenders recognize that not every borrower fits perfectly into their underwriting guidelines.Yet, they embrace the grey area and work to make loans for qualified buyers by using common sense underwriting. At a national lender, everything is black and white. If you don’t fit perfectly into their strict underwriting guidelines, you will be denied without any consideration.
Understanding of local markets — Small lenders use local underwriters and local appraisers to assess each loan and property. This is important because every real estate market is unique and it’s critical that your lender understands the nuances of the communities they lend in.
Technology is ubiquitous — While you won’t hear a local lenders state that you can get a loan in minutes like Quicken famously claimed, they do offer consumers a tech-enabled experience. Technology is rarely built in-house by large national lenders. In fact, today, small lenders often use the same resources and vendors as large national lenders.
Buying a home is typically the biggest financial transaction of one’s life. It is too important to put it to chance by working with a national lender that will not take the time to get to know you, your financing needs or the neighborhood where you want to live.
When I financed my home, I deliberately chose to work with a small local lender instead of a large national lender. Moreover at Own Up, we’ve built our network of lenders entirely from community lenders that are local to each market we serve. I not only made a personal commitment to work with small community lenders, but I staked my business career on it.
If you are looking to buy or refinance, take it from an industry insider — Get out this Saturday (or any day for that matter) and shop small with a local community lender.
