10 Reasons to Get Your Mortgage from a Community Bank
Is a new home about to move from the back of your mind to the top of your to-do list?
As you navigate the housing market, you’ll want to keep an eye on your mortgage options. It might be tempting to go with the biggest bank on the block, but your local community bank is often a smarter choice.
Here are 10 reasons your local community bank might be the best source for your home loan.
A mortgage mission. Mortgages matter at community banks like nowhere else. That’s because many community banks—especially those that have been around for decades—were founded primarily to help families buy homes. Nowadays, mortgage lending is just one of the things community banks do. But it remains the heart of what many see as their mission.
Community cornerstone. Community banks are community cornerstones. They devote all of their resources to one market area. Consequently, their fortunes are tied to that market area. As the community thrives, the bank prospers. Since nothing supports a community like a solid foundation of home ownership, community banks are especially eager to grant mortgage loans.
Personal service. You hear it from every bank: “Here, you’re a name, not just a number.” The difference is that community banks back that slogan with action. Want to talk directly to bank management? It’s possible at a community bank. Outstanding customer service is constantly top of mind because community banks are well-aware it’s their best chance to set themselves apart. Fidelity Bank is so sincere about service that it gave its philosophy a distinct brand—the LifeDesign Difference. “We think of it as a promise, not a slogan,” says CEO Ed Manzi Jr.
Local underwriting. At regional and national banks, mortgage decisions are based on a formula dictated by a remote headquarters. At community banks, underwriting is a local decision, made by people who live in the community and often know mortgage applicants personally. There’s more flexibility to say “yes” to special circumstances.
In-house servicing. Many mortgage lenders promptly sell their loans to other financial institutions. Community banks, on the other hand, tend to retain their mortgages for the life of the loan—borrowers never need to direct payments or escrow questions elsewhere. A community bank that keeps its mortgages doesn’t have to worry about satisfying the lending parameters of a potential buyer. Consequently, borrowers might find more favorable terms and more leeway for situations outside the norm.
Mortgage education. Many community bankers see themselves as teachers more than salespeople. Their desire to strengthen their community translates into a resolve to promote financial literacy. That means you’ll be working with a Home Loan Specialist who wants you to understand your options well enough to make the best borrowing decision possible.
Customer ownership. Some community banks—Fidelity Bank among them—have a mutual form of ownership. They’re owned by customers, not shareholders. With no investors to placate, mutual banks can afford to put people before profits. Mortgage decisions aren’t strictly a numbers game.
Free pre-qualifications. Shopping for a home is easier when buyers understand the finances upfront. Pre-approvals provide a target price range, along with a thorough understanding of projected closing costs and monthly payments. All banks offer pre-quals, but community banks are likely to include a generous helping of education on the side.
Comprehensive options. Think the mortgage menu might be limited at community banks? Not so. You typically can find every product available from the big banks. Want to keep payments low? Build equity faster? Pay off your loan sooner? Buy with a minimal down payment? Chances are, your local community bank has a mortgage product that accomplishes your goal.
Giving back. Community banks are involved in the community. They are often avid supporters of local nonprofit organizations that seek to make the community better. When you get your mortgage from a community bank, you lend your own support to this effort.
Thinking about moving? Then you’ll be making plenty of decisions. Deciding to look into your local community bank for your mortgage might be the best move you make.