Can I Switch Mortgage Lenders Before the Closing?

Home-buying is an exciting--but stressful--time. After going through the process of finding the perfect home and getting a mortgage that fits your budget, the last thing you want to worry about is whether or not you picked the right mortgage lender.

People believe that once they have begun their mortgage application with a lender, they are stuck with that lender until closing, and it's unalterable. It makes them feel trapped.

The good news is that you CAN switch mortgage lenders, and it's not as complicated as you might think. You have the right to choose the best possible lender and loan for your needs. You are the one in control!

If you're not happy with the mortgage loan terms your lender has offered, or if you're unhappy with the level of customer service you've received, know that you have options and can make a change as you want without any regrets.

Here's everything to know about switching mortgage lenders before you close your home.

Why Do Buyers Switch Mortgage Lenders?

There are several reasons why buyers might switch mortgage lenders before closing.

Low Rate

A lower interest rate is always enticing. If you find a lender who can offer you a lower rate than what you're currently being offered, it might be worth making the switch.

Paperwork Issues

Delaying paperwork is one of the most common reasons buyers switch mortgage lenders. If your current lender is taking too long to get you the paperwork you need, or they are constantly asking for more documentation, it might be time to switch.

The average amount of time it should take to process a mortgage loan is 45 days. If your lender is significantly delaying the process, it could be a sign that they are not a good fit for you. Find a mortgage company in Missouri that helps you with closing.

Customer Service

Buying a home and getting a top mortgage lender can be confusing and stressful. Some mortgage lenders do more to help their customers feel comfortable and confident throughout the process.

If you're not happy with the customer service you've received from your lender, it might be worth looking for a new one.

Lender Fees

Mortgage lenders charge a variety of fees, some of which are negotiable. It might be a burden for you as some need a bunch of additional fees. This can be a huge turnoff for homebuyers as nobody wants to feel like they're being nickel-and-dimed. You can compare and choose the best by evaluating their pros and cons.

Lack of Communication

Good communication is key in any relationship, including the relationship between you and your mortgage lender. If you feel like your lender is not keeping you in the loop or they're not available when you need them, it might be time to switch. Mistrust is enemy number one in any relationship, so if you don't trust your lender, it's probably not worth sticking with them.

How to Switch Mortgage Lenders Before Closing

The first step to changing lenders is to find a new one who can give you better terms. Research different lenders and compare their offers. Make sure you are getting the best possible deal and not being asked to pay any hidden fees.

Go through all the rates, terms, fees, and conditions with a fine-tooth comb to make sure you are comfortable with everything. Start looking for mortgage lenders in Missouri that will give you the best terms and fit your criteria. Get the copies of your credit reports and shop around for the best deal.

Once you've found a new lender, the next step is to notify your current lender that you are planning on switching. They will likely ask you to sign a loan estimate form and provide a written notice that you are cancelling your loan with them.

The new lender will then work with you to get all the necessary paperwork. They will likely need things like your employment history, tax returns, and bank statements. Review the loan offer after the application has gone through the underwriting process. Ask your lender to review the loan as well.

The final step is to sign the new loan documents with your new lender. Mortgage note is essential for the closing. This is a legal document that outlines the terms of your mortgage loan. Make sure you understand all the terms and conditions before you sign anything. Close the loan only if you have reviewed it and are happy with them.

The entire process of switching mortgage lenders before closing can take a few weeks, so make sure you leave yourself enough time to get everything done.

The key to making the procedure as smooth as possible is to be organized and communicate with both your old and new lenders throughout the process.

Summing Up

Buying a home is a considerable investment, so you want to make sure everything is perfect before closing your loan.

The reason for changing lenders can vary from customer to customer. Some might be unhappy with the customer service, while others might feel like they're being charged too many fees.

Whatever the reason, if you're not happy with your current mortgage lender, it might be time to switch. Just make sure you do your research and are comfortable with your new lender before you make the switch.