You’ve seen the commercials. You know, the ones for those online banks with no actual branches. Supposedly a great alternative to the big banks and even the local lender- ones who are too expensive, can’t offer the same great rates, etc. but are they really the best idea when you are looking for a home mortgage? How great is that rate if you can’t use it?

High tech world

In today’s mobile, high tech world using an online bank isn’t out of the ordinary. You could actually bank and never need to use a physical bank branch. Between direct deposit, ATMs, mobile and online banking, it almost makes a physical bank branch unnecessary. Almost. There are times, though, when you should need an actual person, in the flesh. One of those times is when you apply for a mortgage.

Applying for a mortgage

Applying for a mortgage is a bit different than applying for any other type of loan. First, it’s a huge purchase. It requires more verification, time and complicated steps. Having a person available when you need them for questions or other things that could pop up is incredibly important. What would happen if you were in the middle of last minute negotiations and need a question answered or a concession made on the mortgage and you can’t get a person on the phone? With your small local lender your loan officer most likely will make sure you can get in touch with them at just about any time.

Communication

But really, you’re thinking, how often would that be a problem? More than you think. Here is a common scenario: you make an offer on a home that is PERFECT for you. The seller counter offers with a number that is just barely beyond the amount of your pre-approved mortgage amount. You know there are other offers on the table and you MUST get this home. Your local bank loan officer is a phone call away (one that will be answered) and gets you an answer or second approval right away. Your online bank, the one with no branches and just a big call center, isn’t answering, or answered and put you on hold so long the call dropped. Guess what? The seller isn’t going to wait for you to finally get in touch with your online bank and took another offer.

Unless you are a very techy person who doesn’t need personal help, go local!