You’re fairly confident you’ve found your dream home, but now you have to determine how you’re going to finance it. Selecting the right mortgage lender is critical, as this is a relationship you’ll have for years to come. With so many lenders out there, how do you choose? Here are five steps you should take to lock down the best lender.


1. Know your credit status.

 Do you even qualify for a mortgage? If so, does your credit score indicate you’ll have to pay a higher interest rate? It’s best to go into a lending situation prepared with this knowledge. If you have some time, looking after this step first can give you the opportunity to bump your score up before filing applications.

That’s why it’s ideal to begin well before finding your new home. When you pay off debts, not only will you be eligible for lower interest rates, but you’ll have more money for the down payment – another attractive quality lenders like.


2. Ask someone who knows.

 It’s so simple, yet it doesn’t always occur to us to reach out to people we know. Ask friends and family who have purchased a home in the last several years who they went with.

If you’re working with a real estate agent, they’re another good source of information. Loan officers and real estate agents often build symbiotic relationships, which can give you an edge with a certain lender. However, this doesn’t mean you have to choose the lender your agent recommends.


3. Compare.

 A lot of us may find ourselves in a situation where multiple lenders are open to working with us. In these cases, we have to compare, which isn’t as easy as it sounds. That’s because each loan will have its pros and cons, making it a little less clear what counts.

When you’re comparing lending quotes and offers, keep your eye on three factors: costs, interest rates, and terms. Fees for appraisals and titles, the length of the loan, and the APR are key points.


4. Ask questions.

 Once you have it narrowed down to a few different lenders, you can ask the questions that could make the choice easier. First, you want to ensure the lender works in a timeframe that works for you, so ask how long they anticipate the process will take.

Ask about closing fees, and see if they’re due at a specific time, or if they’re being bundled into your mortgage. And don’t proceed without being clear on the down payment terms.


5. Do a quick background check.

 Even if you’re sure you found the best lender, don’t forget to double-check the web to see what others are saying about them.

Review sites like, for example, can lay out all of the info for you, reaffirming why you’re choosing this lender.

Once you’ve got the right lender, you can finally let go and feel excited about your big move. As long as you’ve taken care of your credit, gathered recommendations from people in the know, and asked the lender themselves key questions, you’re on the right path to a mortgage you can really live with.