The Advantages And Disadvantages Of Online Mortgage Lending
Online mortgage lending appears to be the way of the future.
However, there are some important things to consider when dealing
with online mortgage lenders.
Let’s start with the advantages of online mortgage lending.
Online mortgage lending is a growing field that is starting to
seriously compete with traditional ‘in person’ lenders. The
process is relatively easy. The important thing to remember is to
make sure your know the ins and outs of any and all online home
mortgage loans prior to submitting your personal information.
In some cases, you’ll find online mortgage lending fees can be
much cheaper than traditional ‘in person’ lenders.
Further, when it comes to online mortgage lending you may
discover a greater range of mortgage loan programs available.
Among the highlights of these programs may be lower rates of
interest and flexible repayment terms.
Also, borrowers with a bad credit history may find online
mortgage lending to be the answer to their prayers. In most
cases, web-based lenders offer more alternatives to those with
less than desirable credit ratings.
Finally, online mortgage lending can shave a ton of time off of
the traditional ‘in person’ route and having to wait (what might
be several days) to be approved. The bonus here is if you don’t
get approved the first time, you can apply to another lender
right away and like the first time, you’ll get your answer quick.
Now let’s explore the disadvantages of online mortgage lending.
It’s important to realize that not all online mortgage lenders
have representation in each of the 50 states. Before taking the
time to apply online, it’s in your best interest to make sure
that the lender in question is represented in the state in which
A big negative with online mortgage lending is unfortunately
accountability. It’s your job as the potential borrower to do
your homework and keep on top of your application. It’s wise to
check out the company to make sure they’re legit and will be able
to fulfil any promises they make regarding terms and interest
Unfortunately with both traditional and online mortgage lending,
the mortgage loan programs offered may be more in lender’s best
interest than in yours. Again, it’s so very important that you do
some research and comparison shopping. Just like with traditional
‘in person’ lenders you want to make sure that any online
mortgage lending is in your best interest not theirs.
Another possible negative is the fact that some online mortgage
lenders will charge you a fee prior to you learning whether or
not your application has been successful. Please note that some
traditional lenders also ask for a fee upfront. Borrowers beware
– there are many legitimate traditional and online lenders than
don’t insist on such a fee.
Unlike any negative dealings you may have with traditional
mortgage lenders, online mortgage lending isn’t regulated by a
governing organization in which you can complain to.
The bottom line is that while online mortgage lending may be the
way of the future, it’s also important to research the lender and
ask the right questions. And, while applying for a mortgage loan
online may seem like a great idea, don’t discount the value of
getting a comparison quote from a traditional ‘in person’