INTERNET LENDERS . . .
PROVIDE LITTLE ASSISTANCE TO BORROWERS!
Borrowers are constantly being urged to apply for their home
mortgages via the internet. More and more, borrowers have been disappointed
with this method of acquiring a home loan. Too often, borrowers are surprised
toward the end of the transaction to discover that their loan documents are
significantly different than they thought they had been "promised"
over the phone.
It is well known that the internet lenders are seeking the
"best" quality borrowers . . . those with high credit scores, low
qualifying ratios and plenty of "reserves" (money left after Close of
Escrow). They have had little patience for the more marginal buyer.
Internet lenders, for a long time, complained that they were
impeded by a prohibition against revealing credit scores to their borrowers. That
changed a long time ago and has allowed mortgage lenders to counsel with
would-be borrowers about how to improve their credit profile and scores. In other words, the internet lenders have
been trying to "catch up" with what local lenders have been doing for
their borrowers for several years.
Humboldt Home Loans has long been a leader in making sure
borrowers understood the importance of credit scores. We make sure a borrower
knows their individual credit scores as well as how the score was derived and
what it means to their ability to acquire particular financing. Via this sort
of frank discussion of credit issues, we are able to advise borrowers on steps
to take to improve their credit scores. In many cases, we uncover erroneous
information contained in a credit report and assist the borrower in correcting
the data, thereby improving credit scores.
Many borrowers benefit from discussions regarding gift
funds, whether it is wise to use retirement funds for down payment purposes or
the rules about having a co-borrower. Local lenders
consistently counsel not quite ready would-be home buyers about a
“roadmap to home ownership” and plans to get ready to buy a
These are all efforts that internet lenders are generally
unable or unwilling to do. Relying heavily upon on advertising to “bring
in the business”, there is little or no mention of any assistance
programs for those borrowers who require extra assistance in preparing to
acquire a home loan.
It is unlikely that internet lenders will be able to counsel
individual borrowers like local lenders routinely do. For instance, we review
every line of the credit report, help make necessary calls to creditors, write
appropriate explanations, draft letters to the various credit repositories
regarding misinformation, etc. Internet lenders have neither
the inclination or the methods in place to perform these important
functions for their borrowers. Only local lenders can provide this
"service" on an everyday basis.
There is no denying the anonymity and the ease of applying
afforded by internet lending sources. But, one can't beat the service and
personal attention acquired via a local lender.