Online MortgagesGet a better/cheaper/faster mortgage online! We’ve seen these ads on TV, online and even heard them on the radio. You may also have heard these ads tout you don’t need a professional mortgage lender now that you have the ability to apply online. As we continue to adopt and embrace the flexibility and convenience of doing things online, many of the products and services for which we used to consult experienced professionals, such as home and auto insurance, tax preparation services, and now, home mortgages, have become available for us to research and apply online, bypassing professional assistance altogether. While the technology exists to purchase or apply for these major products and services, herein lies an important question. Should we be tackling these decisions alone, or instead rely on working with the professionals who have experience in these fields? While we can’t answer this question for every situation, we want to share some insights on some of the pros and cons of online mortgages.

Online lenders are companies that offer loans online without having an actual brick and mortar location in your area. Here are a few pros and cons of doing business with an online lender.

Online Lenders


Pros Cons
Faster process – Online mortgage providers have built their tools around smart technology, making the process quick. Filling out forms – While it’s convenient to apply for a mortgage from the comfort of your living room couch, there’s a greater risk for errors, especially if you do not understand a particular question.
Accepts lower credit scores – You may be able to get approved with a lower credit score as online lenders can ‘loosen’ their requirements a bit more than banks and mortgage companies. Customer service – Should you require assistance throughout the life of your loan, will someone be available to help you? While it may be easy to put off responding to an email, it’s much harder to ignore someone who walks into a branch or an office seeking assistance.

 

Online lenders are just one option available to home buyers. Banks and mortgage brokers still exist and are a better option if you prefer to do business with a local company. Both have been around for a long time and actively support the communities they serve, thus enriching the lives of individuals, families and businesses. Here are some pros and cons of doing business with a bank.

Bank


Pros Cons
Physical locations – Banks offer the opportunity to have one-on-one conversations and will provide assistance throughout the application process. Less flexibility – Those with lower credit scores may have trouble getting approved for a loan. Online lenders have wiggle room, while banks must adhere to strict guidelines.
Peace of mind – Banks are highly regulated. They can provide peace of mind compared to online lenders, so you will know your financial future is in safe hands. Longer application process – The regulations imposed upon banks following the housing market crash in 2008, have resulted in a slower and tedious application process. This is meant to ensure the legitimacy of a loan as well as protect the borrower.

 

Regardless of which option you decide to pursue, it’s important to note that banks offer the ability to apply for a mortgage, home equity line of credit, or refinance an existing mortgage online. The process is very similar to an online lender and is completely secure. Once your online application is submitted, the entire process can be handled electronically. You can even visit your local bank to have any questions or concerns handled by a local lender – one who knows the market and has the knowledge and experience to assist you to the end.

FSB offers a variety mortgages including fixed rate and adjustable mortgages, construction and land loans, manufactured home mortgages, and more. You can also utilize our loan calculators to see how much you can afford to borrow, check our rates, as well as apply online for a loan.

Written by Dawn Beers

Dawn Beers

Dawn heads up our marketing department where she is responsible for the general oversight and management of the Bank’s marketing and public relations initiatives. This involves managing the planning, organizing and directing of our advertising, public relations, product development, sales promotion and research efforts.

View Profile