How to Choose a Mortgage Company to Handle Your Home Loan

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Choosing the right mortgage company to handle your loan is much easier said than done. Mortgage companies have many designations — mortgage broker, mortgage lender, mortgage bank — and then there are individual banks and local credit unions. How do you know you’re getting the most competitive rates the market will bear?

Begin by understanding the small differences between the various mortgage companies.

Helpful terms

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Some mortgage lingo to familiarize yourself with:

  • Broker: A middleman who does not lend own money.
  • Lender: Makes the loan with own funds. (The term lender can also be used to describe all types of mortgage lenders, including brokers and bankers.)
  • Origination: The act of putting together a loan for compensation.
  • Servicing: Collecting of monthly mortgage payments.
  • Warehouse Line: The credit line lenders have in place to originate loans.

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