Unless you have a pot of cash, you’re going to need a loan to buy your new house. And chances are you’ll get that loan from a banking institution. Lenders work for those institutions and help you during the (sometimes lengthy and confusing) loan approval process. Here are a list of FAQ about loans and lenders:
Q. Do I have to use a particular bank?
A. No, though you may want to start with your personal bank since you likely have a relationship there and they know you and your accounts. You may also want to consider a preferred lender recommended by your real estate agency. Your agent should pass along names based on how well those lenders have worked with past clients. But the decision is yours and you should remember that you are interviewing them to work for you.
Q. May I talk to more than one lender?
A. Yes, in fact, you should “shop around” and compare the rates they offer. You may have a pre-approval letter from one institution but you can change banks after you have signed the real estate contract. Your real estate agent will draft an amendment to let the seller and listing agent know that you are changing.
Q. My lender seems to ask for something new or different all the time. Do they really need all of those different documents?
A. Yes, they really do. It may seem overwhelming to track down bank statements any pay stubs and other documentation, but it is very important for you to get everything requested to the lender asap. Even a delay of a day or two can throw off your entire timeline and cause you to delay closing day.
Q. What if I don’t like my lender or I’m having trouble reaching him/her?
A. Talk to your real estate agent! Remember that your agent’s job is to advocate for you during the entire process. S/he can help you communicate with your lender and tackle any obstacles that may occur.