So, you’ve decided to buy a house, and you’re ready for that all important next step—applying for a mortgage loan. But where should you go? After all, the mortgage business is complex, and you’ve realized quickly that your choices for lenders are immense. Here’s a quick guide to help you understand all of your choices for lenders.

Mortgage Banker

By using a mortgage banker, you will deal with the same person from the beginning to the end of the loan process. The mortgage banker makes his money from the fees that you will pay for the loan, such as the points and closing fees. After you’ve closed on the loan, you may continue your relationship with the same company, or they may sell your loan to a secondary person.

Mortgage Broker

If you don’t have the time to loan shop on your own, or have a not-so-perfect credit history, a mortgage broker may be the way to go for you. A mortgage broker acts as a middleman between a borrower and a mortgage banker, and generally knows where the best deals are, or which mortgage bankers are more apt to grant loans to riskier borrowers.

Credit Unions

If you belong to a credit union that should be the first place you check for your mortgage loan because they generally offer lower interest rates. Many associations, unions or even workplaces have their own credit unions.

Savings and Loan

Half of the mortgage loans in the United States are made by local savings and loans. If you belong to one, be sure to check their rates—they’re likely very good.

Government Loans

A lot of people falsely believe that the government is in the business of making mortgage loans—they’re not. But they do “back” certain loans, which make the lenders more apt to extend them. For the best information on government backed loans, talk to your local banker.

There are also many mortgage companies online that can help you find direct mortgage lenders and home loan brokers that will best suit your needs. This is a quick way to find a good mortgage loan and compare rates and offers from multiple lenders. When lenders compete for your business, it works to your advantage.

Here are our recommended sources for mortgage lenders online:

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