Many clients ask me if they should use one of the online lenders they’ve seen advertised on TV. You know the ones—Quicken Loans, Rocket Mortgage, and so on.
My answer to this question? Possibly; there are both pros and cons to working with online lenders.
Let’s begin by discussing the pros:
1. It can be faster and more convenient to work with online lenders, and possibly even cheaper, depending on your situation.
2. Even if you have poor credit, you may still qualify for a loan. This may be valuable to some who are unable to get a conventional loan through a regular lender.
However, there are still downsides to using online lenders:
1. You could be dealing with a scammer. If you’re not using one of the bigger, well-known brands, you might be falling for a scammer’s tricks. These hoaxers will sometimes even charge you for their pre-approval letters! Avoid suspicious, unverified companies like the plague.
2. Online lenders don’t always have help available when you need it. Online lenders tend to dumb down the application processes to make them accessible to more people. The downside here is that you may answer a question incorrectly or find yourself stumped without an option for recourse. Some have 1-800 helplines to call, but those have limited hours and are often busy.
3. Online lenders can’t help you through the entire process. If you’re using an app or a website, you don’t have the benefit of a physical person to guide and assist you through the process.
To get the best of both worlds, work with a local lender who offers an online application. This way, you’d get all the convenience of an online application but also the option to ask any questions you have in person. I’d be happy to send you the contact information of a very good lender I work with on a regular basis.
If you have any questions about the differences between online and local lenders, or about real estate in general, don’t hesitate to reach out to me. I’d love to speak with you.