mortagesandforeclosures

by Direct House

An option for people in the market for a mortgage may be to use a direct mortgage lender. These lenders may be a small, local bank or a large, national institution. Size is not the determining factor. These reason the lender is labeled direct is because the borrower works directly with them as opposed to working with a broker who is an intermediary that may work with multiple lenders. Brokers are able to compare rates between brokers and submit your loan to the lender he decides is best. Both brokers and direct lenders utilize loan officers who may be the actual person with whom you interact. Lenders who work through the middlemen of brokers can also lend directly to borrowers.

Realtors may direct a first time home buyer towards a mortgage broker with whom they have a working history. This does not mean that the buyer is precluded from contacting a direct mortgage funding source on their own. The buyer has the ability to work directly with a lender. You can walk right in to a financial institution and make an application for a first mortgage or do so online. Using a search engine on the Internet can help you find a direct lender. Regardless of the realtor's recommendation, you can approach a direct lender on your own.

A purchase mortgage is not the only product that direct mortgage companies might offer. Many lenders in this market will also offer a refinancing product. Refinancing may be advantageous if you are currently paying interest rates that are excessively higher than those currently available on the market. Refinancing may allow the homeowner to not only minimize the amount of interest being repaid to the lender, but also pull out some cash at the same time (called a "cash out" refinance). As with a purchase mortgage, the person requesting the funding is able to apply for a refinancing loan directly from the lender.

Perhaps you are seeking to pull out some of the equity of your home, without refinancing the original note. In this case a direct mortgage lender would be approached for a line of credit or second mortgage on the property. These are known as a HELOC (Home Equity Line of Credit) or Home Equity loan. These types of loans are in addition to the first mortgage currently in place. As with using direct lending for a first mortgage, your credit history could be important.

Whether you are seeking a first mortgage for a new home or just trying to fund some major renovations, you can work with either a broker or a direct mortgage lender. Both utilize a common application form known in the industry as a 1003. Remember - it's your choice who you use for a home loan.

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Do you like to work with a direct lender when you purchase or refinance your home? Visit us at Direct Mortgage.

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