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drawbacks to using online-only mortgage lenders?
Old 07-10-2012, 02:06 PM   #1
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drawbacks to using online-only mortgage lenders?

Q for anyone who's had recent experience with mortgage lenders: I'm currently planning to buy a home (either SFH, condo, or townhouse) and am shopping mortgage lenders and looking at rates. Some of the rates for the online-only lenders (like Amerisave) look good, but are there any drawbacks to using a lender who has no local physical presence? I do like the idea of having a local contact just in case urgent issues come up, but I'm not sure if this would actually be better than having a responsive online/phone-only contact.

I would be less concerned if this were a refi, but for a purchase I think delays/snafus could be more of a pain.

Your experiences and recommendations are appreciated!

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Old 07-10-2012, 03:12 PM   #2
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I will add an additional question to this....

What are the better companies

So far, the Box Home Loans from the other thread seems to be the best... beats Ameriprise from what I can see...

Most do not give you an estimate of costs unless you give them your info... I did with one site and they have called a few times to the house, but have not supplied the info that I want....

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Old 07-10-2012, 03:47 PM   #3
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Our realtor recommended Rate One mortgage, which is an online-only outfit I had never heard of. They had the best rate and lowest fees compared to several others we checked out, so we went with them. (This was in late 2009.) They were excellent to work with throughout the process. The mortgage was immediately (within days) sold to Wells Fargo (which also happened the last time we bought with a brick-and-mortar mortgage company).

So our experience was positive. Happy hunting!
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Old 07-10-2012, 03:51 PM   #4
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We refinanced our mortgage through an online lender at end of last year. There were no problems with the process, as long as you have a scanner, credit card and email address. Do have all your paperwork scanned (pay check stubs, SS cards, drivers licenses, etc.), as it speeds up the process. Likewise, you'll need to scan and send back their documents that you sign. CC was to pay for the appraisal, and that was done over the phone, as was other conversations. Closing was done at a local title company and we had to scan and email them an "as-built" survey that we had from the original mortgage (to avoid a delay in the process).

There were absolutely no problems with the whole process. We were able to get a discount against the fees, so we only had to come up with the required escrow amount plus appraisal fee. I believe I found the mortgage company through, but the company only does business in our state.
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Old 07-10-2012, 04:17 PM   #5
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I refi'ed with and they were fine. The costs were exactly what the website estimated before I entered any info beyond location and loan parameters.

I refi'ed previously with Virtual Bank, if they're still around. No problem there either.

Both immediately sold the loan, if you care about that. So GMAC now processes my loan and it is owned by Fanny or Freddy I think. Didn't make much difference to me.

I'd take the lowest cost you can find from a place that doesn't have too many complaints.
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Old 07-13-2012, 02:06 PM   #6
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My experience with an online mortgage company was bad. They would often not answer the phone. They insisted on choosing the title insurer. Even though I have a credit score over 800 they treated me like an illegal alien with no credit trying to apply for a jumbo mortgage. They postponed the closing at the last minute. It was a nightmare. I would never again use a mortgage company where I could not go down to their office and see someone face to face, even if the rate is higher.

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