Do you prefer brick and mortar or online lending?

Brick and Mortar vs. Online Lending-What do you prefer?

Buying a home is one of the biggest decisions a person can make—and in all reality, there is no easy button. Finding the right home is a daunting task! Whether you are in the process of buying currently or have purchased a home in the past, the mountain of paperwork may still be haunting you.
So what is the new trend in the home buying process?

Online applications!
As of 2016, the online lending community made a surge! It makes sense, as somehow our lives are becoming more and more busy with work, kids, etc.
Supposedly the shift in trends directly correlates to the smart phone savvy millennial home-buyers. As a millennial myself, I feel everything is based off of accessibility, but I still want the personal touch when I look into buying the largest physical asset/debt I take on. Maybe I am in the minority here? As we continue to see a shift in the way social media and marketing evolves it is pertinent to appeal to the masses, but is the mortgage process one that you want to make via an online lending company or a brick and mortar lender?

Let’s discuss a little further here.

Brick and Mortar:

The phrase, if it isn’t broke, don’t fix it comes to mind. Remember all that paperwork mentioned before? This is where it comes into play now. Apparently, the mounds of paperwork is just too much. It makes sense! You have to bring W2’s, pay stubs, bank statements, tax returns and profit loss statements in to the lender. The same goes for your spouse or co-borrower that is on the loan as well. But on the flip side of that, you have someone to walk you through the entire process and someone you can rely on for questions and feedback. Person to person interaction is irreplaceable and because everything is now online,  I am even more interested in more of the face to face human interaction.

 

Online:

Online mortgage lenders typically are licensed in several states. This is very appealing! Most of these companies are not affiliated with a bank or are non-bank lending institutions. In turn, they aren’t held to the same federal oversight that a bank is so the process can be sped up, another appealing aspect!

Online lenders reduce that timely documentation headache discussed previously. It would seem with the online lending process, the turn around closing time is quicker too. As with brick and mortar mortgages, online lenders also have varying fee structures. Shop around and compare rate quotes when you are working with online lending. Remember, cheaper is not always better.

All in all, the consumer wins! Online lending has made the process quick and easy for the consumer, and brick and mortar companies are allowing for a good mix of face to face and easy access online for their borrowers as well. As always, it is up to the consumer on their own preference of how this transaction works out. What would you prefer?

A Note From The Author:The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Becoming Mortgage Ready-Credit Law Center

At Credit Law Center we work with several different Mortgage Companies across the globe and want to continue educating our consumers that may be thinking about buying or that may be in the process currently. Some clients that we work with are also currently working with lenders to get approved for a loan. Combining what we know about credit, and what our lenders tell us about the loan process, we have broken down and compiled a short list to keep you informed so you feel comfortable in whatever stage you may be in.

Here is what you have the green light on!

Do:

  • Review your credit report in depth (prior to applying if possible) and look at your credit scores-Credit can impact several things (PMI, Interest Rates, etc)
  • Communicate with your lender-Find a lender that works for you and is available for you and communicates with you throughout the process.
  • Decide what the best “type” of loan will be for you-Ask questions and listen to all options out there.

Do Not:

  • No large deposits
  • No unnecessary job changes-These can have an impact on your qualification and the way your income is calculated
  • No large purchases-Do not go buy new furniture for the new house you are pining over just yet!
  • Don’t pay off a collection during the loan process-This can negatively impact you and potentially drop your credit scores and lower the chances of you getting approved!