If you’re in the process of buying a home, you may be wondering if you can change mortgage lenders before your home closes. The good news is that, in most cases, you can switch lenders if you’re unhappy with your current one. However, there are some things you should consider before making the switch.
Why You Might Want to Change Lenders
There are several reasons why you might want to change lenders. Perhaps you’re not happy with the interest rate you were offered, or you feel like your lender is not providing you with good customer service. Maybe you found a better deal with a different lender, or your financial situation has changed and you need a lender who can better accommodate your needs.
How to Switch Lenders
If you’ve decided that you want to switch lenders, the first step is to get pre-approved with your new lender. This will involve submitting an application, providing documentation of your income and assets, and having your credit checked. Once you’ve been pre-approved, you can move forward with the new lender.
Next, you’ll need to inform your current lender that you’re switching. They will likely ask you why you’re leaving, and may try to convince you to stay. It’s important to be honest about your reasons for leaving, but also be firm in your decision.
Your new lender will then work with your real estate agent and the title company to ensure that everything is in order for your closing. This may involve getting a new appraisal or title search, which could delay your closing date. Be sure to communicate with your new lender and real estate agent to ensure that everything is on track.
The Risks of Switching Lenders
While switching lenders can be a good idea in some cases, it’s important to understand the risks involved. One risk is that your closing date could be delayed, which could cause problems if you’ve already made plans to move out of your current home or have other obligations that are dependent on your closing date. Additionally, if you switch lenders too close to your closing date, you could risk losing your earnest money deposit.
Another risk is that you may not be able to get the same interest rate or terms with your new lender as you would have with your old one. This could end up costing you more money in the long run, so it’s important to do your research and make sure that you’re getting the best deal possible.
Conclusion
In conclusion, changing mortgage lenders before your home closes is possible, but it’s important to weigh the risks and benefits before making the switch. If you decide to switch, be sure to communicate with your new lender, real estate agent, and title company to ensure that everything is on track for your closing. And remember, always do your research and make sure that you’re getting the best deal possible.