Before clicking on an internet lender website research what your Delaware local lenders have to offer.
Its hard to avoid all the national advertising for Internet lenders like Quicken Loans, but dont listen! Active Adults Realty is involved in hundreds of transactions a year. We have learned through experience that you will have a much smoother transaction if you use a local lender. Keep reading for why this is true.
Reason #1. The best reason to use a local lender is a local lender only uses local Delaware appraisers.
The appraisal ordering process is quite involved in the current lending environment. All lenders use what is called Appraisal Pools. Appraisal pools are simply a group of appraisers authorized to conduct appraisals for a specific lender. Internet lenders, large banks and national lenders, therefore, have to use very large appraisal pools to serve a wider customer base.
The difference is local lenders only use appraisers highly experienced in the exact zip code of the property being purchased. When an out-of-town or national lender orders an appraisal from an appraiser in Berlin, MD, for a property in Lewes, DE, it can very often cause erroneously low appraised values. When a local lender orders an appraisal for a Lewes, DE property, the appraiser is an expert about values in Lewes, DE. Note: Many things can go wrong with an out-of-town appraiser aside from just value.
Reason #2. Local Delaware market expertise.
Lets face it, all real estate is local and real estate lending in Coastal Delaware is unique. A local lender knows the communities, impact of water, home type, etc., and can provide accurate information during the very first conversation. Delaware market expertise eliminates a need to guess or conduct lengthy research to figure out how to lend on a specific property. We live and lend here!
For example, a customer may be purchasing a townhome and the buyer discloses such to their out-of-town lender. The lender quotes a rate and orders the appraisal. What this non-Delaware appraiser does not normally know is if this townhome is part of a condo association or a home owners association. In most markets across America, a townhome is a standard home with no other concerns.
In Delaware, it can be a townhome or townhome condo combination. If the lender does not understand this at the onset, they will have quoted the customer the wrong rate (townhome condo rates are higher) and ordered the wrong type of appraisal. Additionally, condo lending is very tricky in Delaware and takes serious local experience.
Reason #3. Local lenders know the local Delaware parties involved.
In every home buying process, there are numerous parties involved and we all have to work in concert to ensure a smooth process for the home buyer. The lender has to coordinate logistics, dates, closing costs and turn times with the Realtors (both buyers and sellers agents), closing attorney, appraiser, home inspector, and more and we all have to work together to ensure a smooth process for the home buyer. Understanding the market turn times and how each party receives information is critical to a smooth process. With an out of town lender, we have seen closings get delayed simply due to inefficient communication about the closing date.
I have had to provide emergency closing services where a NON-LOCAL lender has jeopardized or declined the transaction due to one of these three reasons, said Pete Green, Atlantic Bay Mortgage, one of our most trusted business partners.
In conclusion, using a local lender in Delaware is critical to not just a smooth transaction but one that is significantly less stressful and ultimately ends in success.