Many times, when you talk with a mortgage company, you are talking with a mortgage banker. This banker works with different end investors. The investors are the people who will buy the mortgage from the banker after you have secured the loan. Each investor has different types of loans and interest rates. Rates vary between investors because each has different costs for the money and profit margin requirements. Also, each mortgage banker will add their own fees and profit margin.

Many lenders are customizing loans to fit each borrower. There are so many different loan options when it comes to your terms. You could secure a 30 year fixed rate loan with option payments, where you decide how much you pay each month. Or you could go with a traditional set monthly payment and interest amortization. There are so many options you can choose.

That’s why it is important to shop around. Hey, don’t think that going with a large national mortgage company will always get you the best rates and terms. Local banks are desperately trying to compete in what has become an exploding area of investment. Many local lenders will be flexible as to down payments and other aspects.

Here’s the list. Talk with at least one credit union. They are known for low interest rates as most are non-profit. Talk with a local bank; you may find less stringent lending requirements. This is especially true if you are extremely financially stable. And call a national mortgage lender, a local broker and an online lender.

Don’t feel shy about saying to your local lender that another lender is offering a better rate. They might match it. You never know if you don’t ask.

You may think that the cheapest loan is the way to go. Maybe not. Have you ever had to deal with a company that messes everything up and has really awful customer service. And, as I’ve said before, scams are everywhere. One of the most common is called the “bait and switch” where you are quoted one rate but when you get to the closing table it is completely different. The lender is betting that you won’t call the deal off right then and there.

Ask your real estate agent, family members and friends who they would recommend. Anything that sounds too good to be true, is.