Mortgage Shopping? Look Locally

When it comes to getting the best possible interest rate for your home mortgage, apparently big is not better. So don't overlook the smaller banks.

Everyone knows that getting a lower interest rate on your mortgage can save you thousands of dollars over time, but what you may not know is that the best rates are not necessarily offered by the big volume players or the bank where you currently do your checking. Instead, they can often be found at smaller banks and credit unions.
"Neglecting to include smaller community banks and credit unions could prove to be a costly admission," says Greg McBride, senior financial analyst with Bankrate.com of the loan-hunting process.
"In this market, in particular with jumbo large or jumbo confirming loans, smaller community banks and credit unions are very competitive," says McBride.
Compared to large banks, which are more depended on the secondary market, small banks have more flexibility to offer lower rate loans because "they are not dependent on an investor in the second market to eventually buy it," he said.
Smaller banks also have an incentive to offer better rates.
According to Darren Beck, chief marketing officer at LendingTree, smaller banks often have a harder time attracting customers than large banks as they are not as convenient, with fewer branches and ATMs.
"The holy grail is that the consumer is looking for a mortgage but also has financial assets [that they can transfer] and may be a small business owner," he says. The proof is in the numbers based on a recent data from Bankrate.com.

Keep in mind, though, when you hear about low interest rates, it is essential to compare deals on an apples-to-apples basis, as the advertised interest rate is only one part of the puzzle. There are a number of fees included in mortgage loans that could have a significant impact on your total costs including closing costs, pay down points, document preparation fees, underwriting costs and more.

First Century Bank, N.A. is a local Georgia bank. Please contact us today @ 404-798-5109.