A mortgage loan is often the largest and most complicated document any of us have to sign. Choosing a mortgage company from all the mortgage companies you find can seem easier to say and lot hard to do.

Here's What to avoid:

• Out of state lenders.  Without being intimately familiar with our local Austin scene, fees will likely be wrongly estimated, and there are not going to be established relationships with high quality appraisers and title companies here in Austin.  An appraisal problem can be the unwelcome end of your mortgage application.

• E-lenders who are solely or primarily web-based, including mortgage clearinghouses and bidding sites.

• Lenders who will not give you their loan officer's cell or home phone number.  You may need to frequently reach your austin mortgage broker on weekends and evenings, especially on a purchase, where problems may arise in the home inspection or you have questions, need to know if the loan amounts can change, etc.  You should not have to wait until Monday to speak with someone when you have a concern Friday.

• Being swayed by a Real Estate Agent to use their lender.  Expect this, and scary stories about buyers who have found their own lender being taken.  YOU know if you have found a good mortgage company.  If you follow these tips your lender will be better than any Realty Agency Affiliate.  You are best to look out for yourself here, and find a lender who will look out for you, not the Real Estate Agent.  The agent has a goal to sell the property and get paid, and they are NOT on the buyers side first, or really at all.  With your own lender who cares about your satisfaction first, you will find information out before closing that may be on the appraisal, and nothing will be hidden as your lender and their appraiser are not working for anyone but you.  Rate drops will be passed on to you rather than the Realty agent.   Also, kickbacks both legally set up through "Affiliated Business Relationships" and illegal ones, are usually paid to agents, and it will be you who ends up paying for it. Read news article supporting this tip

• Lenders lacking a clean record with the BBB. The BBB states the mortgage industry receives the most complaints against them. 

•  Accepting a closing cost estimate without a maximum fee guarantee.  A Good Faith Estimate as required by RESPA states "the fees listed are estimates - the actual charges may be more or less".  Lenders are not bound to it.  This is why people complain about "hidden fees" or "surprises at closing".  It is 100% legal for lenders to add or change fees. 

•  Giving your application to a data entry clerk over the phone (a sign of a clearinghouse and cost cutting measure.)  It takes at least two years to become a seasoned loan officer.  Work with someone with the skill to advise and inform and make sure they aren't newly in the business.   Look for stability because when a loan officer quits their loans often are dropped.

•  A company who does not offer a definitive written free float down option to current market rates if rates drop before your closing.

•  Lenders who underestimate prepaids (interest per diem and tax escrows) and title insurance fees.  These fees are set by the state and it is illegal for title companies to give any discounts other than the standard 3 discounts they ALL will give (new developments, 7 year reissue, and 3 year reissue).  If a lender quotes a lower title premium than is on the state chart it is a sign they are obviously "low-balling" their closing cost estimates and are giving you a worthless estimate.  This is a litmus test for an honest good faith estimate. 

• Shopping for rates over the period of days or through market volatility.  Rates change from day to day so to compare lenders the quotes you have should all be from the same time period. 

You are paying for a service and it should be delivered quickly and with honesty. 

BE CAREFUL!  We know many other lenders and while we read about some that inspire us, too many loan officers are fly-by-night and unprofessional.  These types are causing mortgage brokers to develop a poor reputation with the public.   Brokers have the better rates, but the banks warn people that brokers are known for adding undisclosed fees at closing.  That must be why people accept the higher rate from banks. If you apply some common sense with a little knowledge, a mortgage broker might be the best choice for you.