Home Loan Guidance Topics

The Long-List/Short-List Process for Getting your Home Loan


This is one process that has helped consumers sort through many of the problem lenders and unscrupulous or novice mortgage sources. Many times, a simple comparison between sources will immediately tell you who's being honest and who isn't, who has experience and who doesn't. Comparison is the key. Further, this process has allowed consumers to learn as much as possible about the home loan needed, long before actually committing to any one particular mortgage loan source. One important thing to note is that the actual shopping for a property occurs toward the end of this process.

This process for getting a home loan source flows like this:

• Identify many, various home loan sources to consider in a "Long-List." This could include mortgage brokers, mortgage bankers, regular banks, credit unions, thrifts, and private lenders. Depending on location, this Long-List should include at least ten or more different home loan sources. The more, the better

• Call and "interview" each of the potential sources in the Long-List to better understand the service they provide, the programs available, the fees they charge, and other questions. Don't commit to any particular source at this stage and don't provide any of your personal documentation yet

• "Weed out" the bad sources based on interviews, the ones that don't seem to give the time of day, or use overly confusing jargon.

• Create a Short-List of those loan sources that seem to have the best potential. This short list should include about three sources

• Pre-approve for a loan with each of the three home loan sources on the Short-List. This includes the formal application process and each of the three potential mortgage loan sources will have to make copies of all the necessary information. No commitment is made to any single source at this time

• Go home-shopping and identify the property wanted to buy and call home

• With the specific home in mind, comparison-shop the potential loan against each of the Short-List mortgage sources. Get specific quotes from each source in terms of interest rate, term, existence of points, total and nature of each and all closing costs, and other aspects

• Depending on how long before reaching "closing," consider locking the interest rate on a home loan with one or two of the best mortgage sources

• Choose the best mortgage source of the three and finalize the loan with them. Thank the others for their time

• Close on the loan and purchase the home

This process has helped people to feel that they received better loans, with reduced costs and more effectively performed deals, than they might have otherwise, while better understanding the process, and learning how various brokers and lenders differ.

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