Local Vs Nonlocal Lender

In this episode, Jennifer talks about common misconceptions regarding local versus non-local lenders. She debunks myths about loan closures and call centers, explaining how technology has evolved the industry. Jennifer highlights that while national lenders are great for standard loans, a local expert might be better for specific grant or down payment assistance programs. She also advises on when to consider a bank and identifies red flags. Ultimately, Jennifer stresses that your lender's expertise and trustworthiness are far more important than their zip code.

Transcript

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Today, we're going to talk about working with a local lender versus a non-local lender, and I'll talk about where it really makes a difference. There's a misconception that you need a local lender in order to buy a house. That's not true. There's a misconception that if you don't use a local lender, your loan won't close on time. That is not true. There's a misconception that unless you use a local lender, you'll be working with a call center. That is not true either. All of these misconceptions are from the past. Back in the day, there didn't used to be a lot of loan officers that worked in multiple states. Over the last few years, that has changed. Social media, technology, people don't want to come into a lender's office like they used to 10 years ago. It's incredibly rare that someone says to me, Jen, I gotta meet with you in person. I actually stopped meeting with people in person 10 years ago. Yeah, I saw it shifting, and I also realized, like, look, if my client's taking a day off of work, I want them to go have fun. I want them to spend time with their family. I don't want them sitting across a desk from me as I read their tax returns. It's not necessary. Okay. So the real difference between a local and a non-local lender is loan products. If you're doing a VA loan, an FHA loan, conventional, basic 3%, 5%, 10%, 15%, national lenders are fine. Totally fine. I would consider myself a national lender, even though I'm like a local lender that went national in terms of how I deal with customer service, how we deal with real estate agents, I still consider myself a national lender. I'm the first person where if a client says, Hey, do you know the specifics on this grant program in a specific area? I'll say, hey, look, I don't have experience in that program. In a situation like that, a local lender can be the best because especially if you're dealing with down payment or grant programs, you want a lender that does a lot of them. Sure, I could muddle through it, but is that in your best interest? No. I always think that the lender should be doing loans they do a lot of. So if you say, Jen, I want a VA loan, easy. Jen, FHA, okay. Conventional, sure, jumbo, let's go. I want to do a non-QM, nope, mm-mm, no. That's the other thing. If you start getting into more exotic loans, I'll be honest, the national lenders, like, would I go to, I can't name names because of the way our industry works. Would I go to one of the big call centers for an exotic loan? No, I'd go to a broker. Like brokers are who you go to when you need something super exotic. Yes, lenders like me have bank statement loans and DSCR loans, but often in the broker space, you'll see some level of hard money as well if that's what you need. Okay. Banks. People go, well, if I work with my bank, then that's good. Here's the sad part about banks, because I get this a lot where people are like, I've worked with them for 20 years, we're one of their biggest clients, you know, on and on and on. I've had this relationship with Bank of da-da-da, my credit cards, I pay everything off, they know this, and they denied me. Once upon a time, banks used to be really big in the mortgage lending space. But after 2008, really they started backing away. And I haven't competed with a bank in traditional financing for five years. Five years. You know, you can look at Jamie Dimon, he's actually gone on the record saying he doesn't like the mortgage business. Banks have moved away from the mortgage business in whole, except for two ways. Number one, sometimes a bank will have a special program in a specific area because they have to. It's part of the regulations. So if you're looking for some sort of magical loan program, sometimes a bank will have one just because it's area specific and they have to do a certain amount of lending in that area. The other part sometimes we'll see banks do great at is jumbo lending. So if you have, for example, a million dollars, two million dollars with the bank, sometimes you'll get a preferred rate. Sometimes you'll get preferred terms. We haven't seen as much of that recently, but sometimes you'll definitely get a lower interest rate because you go, well, why can't you compete with them? Guys, I'm not making interest off of two million of your dollars every single day. I'm just mortgage. They're sitting there going, we'll give them a discounted mortgage because we're making money off of their $2 million that's sitting in our bank every day. Okay? So in a situation just because you've been with a bank for a million years, would I expect the best service? No, no, I wouldn't. I would go to them if you have a ton of money in the bank, a ton, guys. I'm talking over half a million. Or if you're looking for a very special program and you're in an area where they have one. Okay? So look, overall, as a home buyer, what you need from your lender is this: someone who knows what they're doing, someone who gets back to you, someone with good rates, low fees, and most importantly, someone you can trust to guide you on the biggest purchase ever. Quick way to find out if they're gonna get back to you, call them. Call them and leave a message. I always tell people we'll get back to you within 24 hours. The only delay may be on a weekend. We used to be open seven days a week, but recently I decided, hey, you know what? Everybody needs to spend time with their families and loved ones or just relaxing on Sunday. So we're now only open, only, my goodness. We're open Monday through Saturday, okay? Lenders should get back to you within 24 hours. If they're not getting back to you within 24 hours, that's a red flag. If you ask a lender multiple questions and they tell you, don't worry about it, just trust me, that's a red flag. A lender should take the time to answer your questions so that you feel comfortable. This is the biggest purchase of your life. So it's very important that they take time, energy, and effort with you because by answering those questions, it makes you stronger for the future. That's why I do these videos. That's also why with my team, we're like, ask us anything. Ask us anything. Seriously, we will answer every question you come up with. We don't love it when you just say, Chat GPT, ask mortgage questions. You're not learning anything there, right? You're just having, I mean, sometimes we'll just have Chat GPT respond in that case. Um, you're not learning anything in that case, but we're always happy to answer questions. So I hope this video has been helpful. Look, it's not the zip code of your lender that matters, it's the type of loan you're getting and ultimately who you can trust to get you home. Thanks for watching.