Don’t get a mortgage until you’ve explored all of your options.

Key points

• You have many different options for mortgages.
• Local and national banks can sometimes be a good option.
• You should also consider credit unions and online lenders.

If you’re borrowing money to buy a home, you’ll want to get the best mortgage rate possible. Home loans are repaid over a long period and you borrow a lot to buy a property, so small differences in rates could have a huge impact on monthly payments and the total cost of the loan over the life of the loan.

To find the best rate available to you, it helps to get different quotes from several mortgage lenders. And there are different types of lenders you should try, including the following three options.

1. Banks

Local and national banks usually offer mortgages. Many people do not work with banks, especially if they have a pre-existing relationship with a bank because they have a checking or savings account at that institution.

Banks can be a good option for borrowing, but be sure to look beyond the bank where you have checking accounts. You can consider large and small banks to see which offers the best rate and the types of loans that interest you.

2. Credit unions

Credit unions are different from banks because they are member-owned, not-for-profit institutions. It is often possible to obtain a mortgage with a lower interest rate from a credit union than from a bank.

A downside of credit unions, however, is that you usually have to be a member of the credit union in order to get a loan from it. Different credit unions have different types of membership requirements. In some circumstances, becoming a member is as simple as paying a membership fee. But with other credit unions, you may have to meet stricter requirements, such as being a current or former military member, living in a specific state, or being a member of a certain organization.

3. Online lenders

Finally, online lenders are another option to consider when looking for a mortgage. Unlike banks and credit unions, they generally do not have local branches. You will usually have to complete the entire loan application process, either over the phone or over the Internet. While some people prefer the convenience of this, others miss the hands-on customer support when making big loan decisions.

Online lenders sometimes offer lower rates and better terms than banks or credit unions because they don’t have the maintenance costs of physical structures. It can also be faster and easier to get mortgage quotes from online lenders since you can do it on the internet. However, a growing number of banks and credit unions are also offering online quotes, which may not be a specific benefit to online-only mortgage lenders.

By getting quotes from these three different types of lenders, you can really explore all of the options available to you. Since different types of financial institutions may be better suited to specific borrowers, it’s worth taking the time to review each type of mortgage provider before going through the pre-approval process and understanding. commit to borrow.

When you get the most affordable loan possible with the most favorable terms you can find, you’ll be glad you made the effort.