Submitted by ShoesMuhGoos t3_10q9xnp in personalfinance
Hello, first time home buyer here. I was wondering if someone could give me some info on the pros/cons, if any, of getting a mortgage through my bank as opposed to a company like Rocket Mortgage. Any insight would be appreciated. TIA!
Doesn't getting a quote require pulling my credit? I don't want to take a hit for an inquiry.
Multiple inquiries at the same time don't have any extra effect beyond just one.
Once you get a lender to pull your credit you will have 15 days to shop around without the other hard inquires affecting you. I would say, if you can, have a lender do a soft pull to make sure your ducks are in a row prior to having your credit pulled. Our lender can do that and then he tells us what we can pay down or pay off in order to boost our credit to get better pricing
Do NOT always go with the cheaper rate. This is a big financial decision and you want the deal to be smooth and you want to know that the deal is going to close accordingly. There are nightmare stories about Rocket Mortgage. Find a lender who is referred to you by people you know or people who invest. Find a couple of options. Then talk to them and find out which one is the most transparent, reliable, communicative, experienced and has a competitive rate. Sellers often deny rocket mortgage offers because they are known to fumble last minute:
https://www.reddit.com/r/realtors/comments/10l5eo8/sellers_distrust_rocket_mortgage/
Depending on where you are looking to buy - there are loans out there geared towards lower income/rural placement as a way to bring new people into the communities. There are guidelines and such but it's an avenue I feel like a lot of new homebuyers don't know about.
Is that a program I should look into? Or is it just something that companies know about for first time buyers?
It is a government program, the USDA loan program and you do have to go through specific lenders/banks to apply. But they're zero down loans, the houses have to be in move in ready condition (no repairs needed or anything) and they're more income based than credit based (meaning lower end credit is looked at with a little less scrutiny if you can show you have the means to repay the loan)
Get quotes from your bank, other banks, credit unions, and Rocket Mortgage. See who offers the better deal.
Since you're a first time homebuyer it might be best to use the program in your state. If you're not buying rural property it's usually the best option and only requires 3.5% down.
Things to keep in mind when looking at houses:
Sellers will expect you to have "Earnest Money". You give this money to the title company and they hold it in an escrow account. There will be conditions in the contract on how the money is handled but it's usually non-refundable after your inspection is complete.
First time homebuyer programs only require 3.5% down but come with mortgage insurance requirements which can add hundreds to your monthly payment.
USDA loans are similar but with 0% down (they only apply to houses in rural areas).
Your lender will approve you "up to" a certain amount. You will end up taking out only as much as is needed to cover the house with your down payment and earnest money. There's no reason for you or your realtor to tell the seller/their realtor how much you were pre-approved for (they only need to know that you were pre-approved).
Take your time, some realtors will try to push you to close quickly. They want a fast sale more than they want the right sale.
Sellers and their realtors will use shady tactics such as claiming another offer came in after you make an offer to try and get you to bid higher. Don't panic bid and don't get too attached to the prospect of a particular house.
This is your first house, not your forever home.
meamemg t1_j6oqctt wrote
Get quotes from both and see who is cheaper.