August 23, 2011 – The Internet opened the floodgates for businesses to offer their services online. While these services may not appeal to everyone, the new generation of homeowners — the same generation that is accustomed to banking, shopping and conducting other business online — has embraced new technology making online mortgage transactions possible.
Still, with online fraud and identity theft on the rise, how can you guarantee that the company is a safe and legitimate business? With a little investigation, you can rest assured you’ll find the best deal on the Web and be safe while you’re at it.
Do your homework. Visit some of the bigger online players, such as www.ditech.com (now conducting business through http://www.gmacmortgage.com), www.e-loan.com, www.quickenloans.com and www.lendingtree.com and navigate through their sites to get a feel for the company. Are they a member of the Mortgage Bankers Association? Are they an equal housing lender? Do you know anyone who has used them in the past? Be sure to check out their site’s security and privacy statement.
Stick to the names you know. An online search of mortgage companies will provide you with enough names to keep you researching for hours. However, if you’ve never heard of a lender, it’s probably best to avoid them. Selecting a mortgage company is a major decision, and it is usually best to go with a familiar name.
Compare the criteria. Like shopping for appliances, computers, or anything else, the more comparisons you make, the better deal you’ll most likely find. Arm yourself with plenty of information on rates, loan products, processing times, resources, tools and more to find out what’s best for you. The more you know about the mortgage process the better off you’ll be.
Ask for the bottom line. If the lowest interest rate is the selling point that makes you decide on a lender, be sure to find out the annual percentage rate (APR) or the true cost of the loan. This is the interest rate, plus any additional fees and/or points charged by the lender. Lenders are required by the federal government to provide you with the APR in order to help you make comparisons.
Protect yourself. Online lenders often require personal data, such as social security numbers and information on bank accounts. Never submit any personal information before you determine the safety of the site. Look for an icon, such as a padlock, at the bottom of your browser window, which indicates that it is secure.