I had a buyer last month come to me with a pre-approval letter and a big smile. Ready to go house hunting. Cool cool cool, I said, but then I asked one question. Did you talk to more than one lender?
Silence.
This happens all the time. A first-time buyer goes to their bank, the one they've had since college, fills out the application, gets the letter, and assumes that's the whole process. The rate they got? That's just the rate. The closing costs quoted? Just what it costs. No shopping, no comparing, no second opinion.
That's a mistake.
Here's what I tell every buyer I work with. Talk to at least three lenders. Your big bank, a local credit union, and a mortgage broker. The differences can be wild. I've seen rate quotes on the same buyer vary by half a percent between lenders, and on a $350,000 loan that adds up to real money over 30 years. We're talking tens of thousands of dollars in interest. Same buyer, same credit score, same income. Just a different lender.
Some buyers feel weird about it, like they're being disloyal or wasting someone's time. You're not. Lenders expect it. They want to compete for your business. And honestly, a good lender won't be scared of the comparison. They'll welcome it because they know their product is solid.
I also think buyers should pay closer attention to lender fees, not just the rate. One lender might quote you 6.5% with $4,000 in origination fees. Another might quote 6.75% with zero origination. Which one is better? That depends on how long you plan to stay in the house, and a good loan officer will walk you through that math.
There's nothing fancy about my approach here. I don't have some secret lender list or special hack. I just think first-time buyers deserve to see their options before they commit to a 30-year financial relationship. That sounds like common sense, but I watch people skip it every single month.
So before you start sending me listings you love on Zillow (and I do want those, send them all), just make sure you've done the lender homework first. It's one conversation that can save you a lot of money.
Did you only talk to one lender? Talk soon.