Getting Mortgage Quotes Online – Safely and Smartly
February 6, 2009
by Brandon Cornett
The Internet has changed nearly every aspect of the real estate process, and that includes the way we research, compare and apply for mortgage loans. These days, you can use the Internet to save time and energy when shopping for home financing. But there’s a right way and a wrong way to go about it.
In this article, I’ll explain the process of obtaining quotes from lenders via the Web, and how to do it safely and smartly.
Unbiased Advice for Consumers
It’s customary to withhold the author’s bio until the end of an article. But I feel it’s necessary to share something about myself at this point. Many of the mortgage advice articles you find online these days were written by the lenders themselves (or ghost-written on their behalf). But these authors are clearly biased when it comes to this subject. They want to sell mortgage loans — it’s what they do for a living. So their articles are written to educate readers toward a certain product or service.
On the contrary, I am not selling mortgages. I publish a consumer-oriented website full of helpful, unbiased information on this subject. So the purpose of this article is not to educate you toward a certain product or service, but merely to educate you.
The Benefits of Online Quoting
Let’s talk for a moment about the benefits of getting home loan quotes via the Web. The first and most obvious advantage is convenience. Before lending institutions embraced the Internet, you had to spend a lot of time on the phone in order to get multiple quotes. Or even worse, you had to drive around town to local branches and offices.
Using the Internet, however, you can fill out a simple form on a mortgage “aggregator” website and get offers from several lenders in response. This is a big time-saver, and it makes life a lot easier. But it’s not the only benefit of using the Web.
You also have access to a wider variety of mortgage products when you use the Internet to obtain quotes. Some lenders specialize in a certain type of home loan, while others offer a broader range of packages and terms. The Internet opens all of these possibilities up to you. As a direct result, you are more likely to find a mortgage product that matches your financial needs.
Being Smart About the Process
Anytime you conduct financial business online, you have to be smart and cautious in order to protect your identity. That applies to getting loan quotes as well. So let’s talk about the ways you can be a smart consumer when shopping for mortgage offers via the Web.
– Use Trusted Websites — The big names you see on TV all the time (Lending Tree, Ditech, Eloan, etc.) are usually your best option, in terms of security and trustworthiness. These companies have a lot at stake, so they take things like Internet security very seriously. In other words, stay away from “Joe’s Mortgage Emporium” and other questionable websites.
– Learn Your Credit Score — When you request quotes from multiple lenders, they will present you with some basic information. After all, they can’t fully qualify you for a loan or determine the interest rate until they conduct a more formal review of your credit and financial history. So if you know your credit score in advance (and whether you are at, below, or above the average), you’ll be able to determine how realistic those quotes are.
– Determine Your Own Budget — Don’t let a mortgage company suggest what you can or cannot afford, in terms of a monthly payment. You have to determine that for yourself. A lender can only tell you how much of a loan they’ll offer you — not how much you can realistically afford. So use mortgage calculators and other budgeting tools to find out what your limits are with regard to monthly payments.
Conclusion and Summary
The Internet can certainly save you a lot of time when shopping for a home loan. It can also open up a wider range of mortgage products and terms. But like any other financial process, you have to be smart about getting quotes online. Stick with reputable companies and websites. Conduct a financial self-assessment of your own. A little homework goes a long way.
About the Author: Brandon Cornett publishes the Home Buying Institute, a website full of advice on mortgages loans, house hunting, credit scores and more. Learn more or contact the author by visiting http://www.homebuyinginstitute.com