Mortgages 101: Are Online Lenders a Reputable Option for Homebuyers?
If you’re shopping for a home, you’re probably evaluating multiple mortgage lenders for the best deal, personalized service and low-interest rates. You may be looking for an online lender — or at least a lender with an online application process — for speed and convenience.
But are online-only lenders as reputable as other mortgage brokers? Can you count on the same quality of service?
Rocket Mortgage, the online mortgage lending division of Quicken Loans, is rated as one of the largest mortgage lenders in the U.S., according to Time.com. The company originated more than 1 million loans in 2020. It has a lower-than-average number of consumer complaints in the Consumer Protection Financial Bureau’s database.
Online-only lenders that offer digital mortgages, which means the application, loan documentation and processing, are all done online, may be faster, easier and less costly. A New York Federal Reserve Report discovered that digital mortgages can be processed 20% faster than conventional loans.
Many traditional brick-and-mortar banks do have online mortgage applications, today, so if you’re looking for a balance between in-person service and convenience, you may consider financial institutions like JPMorgan Chase, rated as one of GoBankingRates’ top banks of 2022, or Navy Federal Credit Union, which touts 24/7 customer service.
If you choose an online-only lender, you’ll want to make sure the company has customer service hours and availability in the method you prefer, whether that is email, phone or chat.
Compare rates carefully and shop around. Online lenders may advertise lower rates, but if you don’t qualify for those rates based on your credit score, employment situation or other factors, an in-person lender may be able to get you a better deal.
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