Question

Prepare an essay on comparative analyses of mortgage lenders' offers in India. Write NO less than 700 words

Answer 1

INTRODUCTON

A mortgage lender is a bank or financial company that lends money to borrowers to purchase a home. A mortgage servicer handles the payment processing and is the company that sends the monthly statements to the borrower. A mortgage lender or bank can be both the loan provider and the servicer of the mortgage. Both a lender and loan servicer have specific policies and procedures that they're required to follow, and both are regulated by the federal government.

A mortgage lender is a bank or company that provides home loans to borrowers.Some lenders also offer auto loans, personal loans or student loans. Some offer mortgages and other home-related loans.A mortgage lender provides you with the funds to buy your home.

TYPES OF MORTGAGE LENDERS

There are various types of mortgage lenders, from local and regional lenders to big brand-name financial institutions. Lenders can be banks, credit unions or online only. The best lenders offer different incentives, such as lower APRs or zero fees. This means you might have a different set of criteria at one lender compared with others when shopping around for the right match.

There are retail lenders, direct lenders, mortgage brokers, correspondent lenders, wholesale lenders, and others

Mortgage Brokers

Mortgage brokers work with a host of different lenders, but it’s important for you to find out which products those lenders offer. Keep in mind that brokers won’t have access to products from direct lenders. You’ll want to shop a few lenders on your own, in addition to one or two mortgage brokers, to ensure you’re getting the best loan offers possible.

Mortgage Bankers

Most mortgage lenders in the U.S. are mortgage bankers. A mortgage bank could be a retail or a direct lender – including large banks, online mortgage lenders like Quicken, or credit unions.

Retail Lenders

Retail lenders provide mortgages directly to consumers, not institutions. Retail lenders include banks, credit unions, and mortgage bankers. In addition to mortgages, retail lenders offer other products, such as checking and savings accounts, personal loans and auto loans.

Direct Lenders

Direct lenders originate their own loans. These lenders either use their own funds or borrow them from elsewhere. Mortgage banks and portfolio lenders can be direct lenders. What distinguishes a direct lender from a retail bank lender is specialization in mortgages.

Portfolio Lenders

A portfolio lender funds borrowers’ loans with its own money. Accordingly, this type of lender isn’t beholden to the demands and interests of outside investors. Portfolio lenders set their own borrowing guidelines and terms, which may appeal to certain borrowers.

Wholesale Lenders

Wholesale lenders are banks or other financial institutions that offer loans through third parties, such as mortgage brokers, other banks or credit unions. Wholesale lenders don’t work directly with consumers, but originate, fund and sometimes service loans.

Warehouse Lenders

Warehouse lenders help other mortgage lenders fund their own loans by offering short-term funding. Warehouse lines of credit are usually repaid as soon as a loan is sold on the secondary market

Shopping for a Mortgage Online

In today’s tech-savvy world, many mortgage lenders and brokers have automated the application process. This can be a huge time-saver for busy families or professionals as they balance choosing the best mortgage, searching for a home and their day-to-day lives. Some lenders even provide apps so you can apply, monitor and manage your loan from a mobile device.

There’s no right answer to this since every lender offers different features and terms. But you should compare many lenders based on:

• Interest rates: The lower the interest rate, the less you have to pay on your principal, or original loan amount. While your rate is largely based on your credit score, credit history and debt-to-income ratio (DTI), the rate you are offered will vary based on the lender you choose.
• Ease of communication: Can you make payments online, over the phone, through an app or another way? Does your potential lender contact you through emails or text? The more your lender opens up the communication channel, the easier it’ll be for you to stay on top of mortgage payments. Missing a mortgage payment not only causes your credit score to drop but could lead to a default loan and foreclosure on your home.
• Fees: Sometimes lenders will roll fees into the home loan rather than have the borrower pay them upfront through closing costs. Some fees can be negotiated, but many can’t.
• Down payment requirements: Your down payment amount might be based on a factors, like your creditworthiness and DTI. Compare lenders to see which ones have affordable and
• flexible down payment requirements.

• Not all banks, credit unions and online lenders have the same requirements or the same terms. Make sure to review multiple lenders before you choose one.

FINDING THE BEST MORTGAGE LENDERS

There are plenty of mortgage lenders to choose from. Compare banks, credit unions and online lenders to see which ones offer the lowest interest rate, fewest fees, and most friendly down payment requirements.

There might be other factors in your decision unrelated to finances. For instance, do you want to be able to visit your lender to talk about your loan in-person? If so, a local bank or credit union might be better for you. If you prefer to use an online lender for easy application and approval, you may not need to look at traditional banks and credit unions.

Since there are so many different options for mortgage lenders, you’ll want to tailor your search to your specific needs. Remember, not all lenders offer the same loan types, so you’ll want to factor that into your criteria as well. Finding the right mortgage lender isn’t necessarily what’s best for everyone, but rather, what’s best for you.