You’ve decided that you’re ready to purchase a house. You’ve started looking at listings online,…
A lot of new homebuyers think the first step in the process of buying a home is finding the home you want. But finding the best California lender is what you should do before doing anything else. And making that step a priority makes perfect sense when you think about it. After all, that loan is going to be a part of your life for years, so finding the most suitable one for you and your situation is worth putting a lot of time and effort into before you have a home picked out.
While it may seem daunting, finding the best California lender (and the best loan!) doesn’t have to be a hard process.
1. Consider your specific needs
You may think that all lenders are the same and finding the one that fits your situation best is akin to a roll of the dice and a quick Google search. But think about who you are, what you’re looking for, and what kind of loan(s) you might be eligible for. Are you looking for an FHA loan? A VA loan? Will you buy a house, a condo, a piece of property you plan to build on, or are you open to multiple options?
Different lenders will have different levels of experience across the range of possible homes and home loans. So when you’re searching for your lender, look for ones with experience that matches your wants and needs as closely as possible.
2. Find a compatible personality
In many cases, a home loan is the beginning of a lengthy financial relationship between you and your lender. And while the financial aspect is the one that people tend to focus on, it’s worth considering the “relationship” aspect of the loan. Your lender will be a person—or people—who you communicate and work with for years, even decades. And while you absolutely want a professionally competent lender, you’ll also want one you feel comfortable interacting with on a regular basis.
Make sure your communication styles mesh and that you feel 100% at ease asking questions, getting advice, and talking with your lender about your needs.
3. Do your research
This is probably the most important step and will likely take the longest, but it’s also probably going to be the easiest. Thanks to the internet, there is no shortage of independent informational and ranking websites to help you research any and all potential lenders in California. But don’t just take their word for it—get some firsthand accounts. Talk to any friends, relatives, coworkers, neighbors, etc. who’ve already purchased a house and gone through the process of finding a California lender. Also, be sure to read up on the current state of California real estate in general. Understand the broader picture in addition to the specifics of different lenders. The more input you get and information you have, the better you’ll be able to decide which lenders to reach out to.
4. Comparison shop
After all your research, you may think you’ve found the perfect lender for you. And maybe you have, but it’s best to go a few steps further. Get quotes from multiple potential lenders, ideally including lenders of different types—banks, credit unions, local California lenders, etc.—to see what your best possible option might be. And when looking at different quotes, be sure to compare all aspects of a potential loan: the interest rate, monthly mortgage insurance payments, upfront costs, closing costs, etc. You can start with comparison websites, of which there are many to choose from, and then reach out to some of the lenders for an actual, personalized quote.
Another great option is to hire a broker—like New Way—to do the comparison shopping for you. At New Way, we work with a variety of lenders and have a large number of loans to choose from to make sure you get the one that’s just right for you. Having a professional do the legwork is often the best way to ensure you connect with the best possible lender for you.
5. Decide if you want an online or in-person lender
Home loans through large, online lenders have become exponentially more common in the internet age, but some people still prefer to go through the loan process via personal interactions with local lenders—or local branches of larger institutions. There are upsides and downsides to both of these options. And while either can probably fit most potential home buyers’ financial situations, you may prefer one over the other for any number of reasons. In this hot housing market, an in-person lender is often the way to go because it gives you a better chance of writing a competitive offer.
Online loans can be simpler and faster and sometimes come with a lower interest rate, but in-person loans mean you get the benefit of one-on-one interactions with real people and someone to help if your loan hits a snag (which can also save you money and time in the long run) What’s most important to you?
Finding the Best California Lender for You
After finding the right home, finding the right lender is arguably the next most important step in buying a house. You want to make sure you’re getting the best loan possible from a lender you know you can trust. After all, your relationship with your lender will last for years or even decades. If you’re going to be communicating with someone about your finances and your home, you want to be absolutely sure it will be a positive experience, which is why finding the best California lender for you is an essential part of buying your home.