How do you pick a mortgage professional?

Reputation of the company? Best rate? Lowest closing costs? Reputation of the mortgage professional? Customer service? Every person has their own criteria, but you may want to consider yours prior to entering the mortgage process.

Ask yourself, "How much do I really know about mortgages?" There are many articles and posts out there lately that discuss personal opinions on how to find the best mortgage. Some finance advisers recommend Bankrate.com, while others recommend a trusted professional they have worked with in the past. J.D. at Get Rich Slowly posted a great article on his advice and received dozens of comments from people regarding their experiences. The comments concern me. Here are a few comments from his post and others:

• "Don't be afraid to change to a different company" -- I couldn't agree more. But this only holds true if you minimize the upfront costs. Lock fees, applications fees, etc. are designed to prevent borrowers from going elsewhere and ensure the mortgage company cuts their losses. Be very cautious with any mortgage professional who says, "I need a credit card to get the application process going". At that point, you're pretty much stuck! If there is not something tangible you are paying for upfront (credit report, Fannie Mae findings, etc.) you should be able to pay for it at closing -- assuming you close, right?
• "Go with someone that holds the mortgage" -- You have no control over who owns the mortgage. Banks make money buying and selling loans. Regardless of what anyone tells you, a "promise" your loan will not be sold is a big lie. A bank can retain the servicing rights on a loan, sell the loan off, and you would have no idea the loan has been sold. Don't lose sleep over what you cannot control. Servicing rights can be sold just as easily.
• "Get educated" -- I couldn't agree more. Hopefully that's why you are reading this!
• "Relationships don't matter..." "It is strictly business" -- Garbage. I have seen more personal acquaintances and past customers get taken advantage of by other mortgage professionals in the past 2 months than I have in the previous 3 years. Tell me "relationships don't matter" when your closing costs come in double, your rate is higher, the loan isn't what you asked for, or you can't get ahold of your mortgage professional when a question arises.
• "I went with a company because they never wrote any bad loans or sub-prime loans" -- With mortgage delinquencies over 8%, if you believe that then I have some great swamp land I'll sell you for a few million!
• "If it sounds too good to be true, it usually is" -- Touche! This could not be more true for mortgages!

I always say that reading a couple of articles does not make you an expert, nor does owning a couple of properties. I know very little about cars, and I don't pretend to. But my approach has worked well and it applies similar to mortgages -- find someone (a mechanic) you trust, make sure everything is explained to you, compare costs, and make sure they're not going to jerk you around.

Yet somehow it amazes me there is still more "bad" information available than "good" info when it comes to mortgages. Ask yourself, how do you make your decision? I have seen alot of bad decisions the past few weeks and I'm at a loss for words trying to analyze the logic of the borrowers. Nonetheless, I realize people make stupid decisions (Myself included!). I'm just trying to help everyone make fewer of them!

Make it a great day!