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From...
Getting a mortgage in cyberspace isn't for everyone
November 10, 1998
Web posted at: 8:50 AM EDT
by Brad Grimes
(IDG) -- You can do just about anything on the Web, from buying a new book to booking a dream vacation. So what about surfing the Net to get the biggest loan of your life? That's right, these days you can even get a mortgage in cyberspace, but the process isn't for everyone.
Recently, my wife and I bought our first home. Being a Web addict, I explored the possibility of getting our mortgage online. I was surprised to find several sites offering home loans. These online brokers promised low rates, low fees and stress-free borrowing.
Quicken Mortgage is an excellent site for learning the process and researching mortgages. I found the high, low and average rates in my state. And as in other sites I discovered, including E-Loan and Home-ByNet, I was able to figure out how much I could afford to borrow, shop for a loan and even apply online. (Microsoft's new Web site, Home Advisor wasn't up when I was doing my research, but it is now.) I settled on HomeShark, which kept popping up in recommendations from people on the Web.
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The online application process was much as it is in the physical world, except the online lender can do a credit check in almost no time. I provided information about my family income, our assets and the loan we were looking for, and HomeShark provided a choice of loans from big-name lenders.
The day after I submitted my application, a loan officer from HomeShark called me to finalize things. The fact that she was calling from 3,000 miles away made me nervous. I wasn't sure if I wanted to negotiate a multithousand-dollar loan over such a long distance.
And what about the great savings? Well, I put my HomeShark estimates next to estimates from a local traditional bank, and frankly, I didn't see any big savings. If anything, fees for the HomeShark loan were higher.
In the end, I got my mortgage from a local bank. One reason was that I could actually sit face-to-face with my loan officer and ask questions. This isn't to say online brokers are a sham. I did use HomeShark's prequalification process to quickly get a letter stating I was likely to be approved for a loan. This bolsters an offer in a competitive housing market. Online-mortgage sites are also invaluable as research tools and may be a good option for people familiar with the process.
At this point in my life, however, I chose the comfort of a faux-leather chair and a hearty handshake.
Brad Grimes is a senior editor at PC World.