Working with Lenders

Here are some tips for getting the most out of your mortgage lender:

Do your homework:
The more knowledgeable you are before you approach lenders, the better deal you're likely to get. A loan officer will take you more seriously if you ask, "What's the rate for an adjustable with 10 percent down, linked to the 6-month LIBOR with a margin of no more than 2.75 and a 21-day lock?" If you ask, "Hey, what's a margin, anyway?" an unscrupulous lender will smell blood in the water.

Work the phones:
Interview lenders over the telephone before meeting with them in person. Lenders and brokers may want you to meet in person -- to pressure you into filling out an application -- but if you know what type of loan you're looking for, there's no reason you shouldn't comparison shop via phone.

Make 'em work for it:
Let lenders and brokers know that you're shopping around. If a loan officer knows you're shopping -- particularly with a large bank or S&L, which often offer the most competitive rates -- he's more likely to cut to his best offer. But be skeptical, particularly if someone quotes you a rate that is more than half a percentage point lower than the others.

Lender check-up:
The mortgage industry is increasingly dominated by small- and medium-sized brokers and mortgage bankers, rather than the big familiar banks and S&Ls that once handled most loans. It's crucial that you check out a company's past