What to Ask Your Loan Officer
Whether or not you use a mortgage broker or a mortgage banker is not the biggest issue. Below are a set of questions you should ask of any loan officer and that should help you in your decision making process.
Questions to Ask:
Can you do both conventional and government loans? Tips: You are looking for someone who can do all types of loans. Many brokers are not FHA or VA approved and that may be the loan you need.
What do you consider loan specialty? Tips: You are generally not interested in someone who does sub-prime loans as his/her specialty, because those were easy loans and expense loans. The loan officer might try to take you into a sub-prime loan product as his/her first choice.
How long has your company been in business? Tips: do you really want someone who is brand new?
How long have you been do mortgage loans? Tips: This is an important question. If they have been doing this for over 5 years, they should have enough experience to complete your loan efficiently and will know more options than a less seasoned loan officer.
Do you do anything other that mortgage loans? Tips: many bank officers at large banks who do mortgages also do car loans, installment loans and don’t know mortgage loans thoroughly enough to help you. If they can positively answer the next question then this question is less important.
How many loans did you personally close last year? Tips: a good loan officer should have originated and closed at least 60 loans per year or MORE. The loan officer will show he/she is experienced enough and is active enough to keep up with the changes in this business, which are many.
How many loans have you personally originated throughout your career? Tips: If the loan officer has originated 250 or more, it shows he is experienced. You want someone who knows what they are doing as well as being honest.
Can I lock in the rates while the loan is being processed? If so, for how long? Tips: One of the biggest scams in the industry is to quote you a very low rate at the start and then raise the rate later at closing and blame it on the interest rates going up. Many times that is just not true. You want to know if they will give you a 30 day or better yet a 45 day interest rate quote. If you like the rate (which will be slightly higher, since you are locking in the rate), then lock the rate in. Get this in writing. Rate Locks under 30 days are worthless unless you are already approved, so don’t get them if you are just starting the process. Get one over 30 days.
Do you give written lock agreements? Tips: No rate lock in is valid unless it is in writing and signed by a manager or loan officer, so get any rate lock in writing.
Are you a member of the National Association of Mortgage Brokers or the Mortgage Bankers Association? Tips: These are the main trade organizations and they have a code of ethics that members are required to meet.
MCA offers a product to protect you against potential mortgage fraud and over-charging. It is called the Consumer Protection Plan. A Mortgage Professional will review your initial mortgage disclosure documentation and when the loan is ready to close the MCA professional will also review your closing settlement documents to make sure you received the correct program, rate and fees as initially disclosed.
