How To Select The Right Mortgage Company

Understanding the mortgage providers are, will help you select the right mortgage company.

There are lots of different mortgage companies available to choose from in today’s lending environment. These sources include private mortgage banks or depository institutions. There are also individual private parties otherwise known as hard money, but for these purposes we will be focused on the two main outlets. Everyone is familiar with the fact banks like Wells Fargo offer mortgage loans. When you work with a mortgage company like this, you will also be asked to open up a checking account as well as a credit card in most cases and you’ll be receiving basic mortgage service at best.

Big banks do provide a very valuable service to home loan industry and that comes in the form of servicing. Banking institutions such as Wells Fargo or Chase are very good at collecting monthly payments and servicing that mortgage, partly due to the fact most are still well capitalized. Here more information on Bank Mortgage Rates.

So the big banks are good at servicing, but what about selecting the right mortgage company?

Now that we have established big banks are primarily very good at servicing we can now understand that the best possible mortgage rates and the best mortgage will almost always be offered by an independent private mortgage banker. Private mortgage banks make loans and sell them to the bigger banks. Because the smaller companies don’t have all the other ancillary services, they can not only close a loan with a better interest rate, but can provide substantially better service and a faster close of escrow. These small mortgage banks operate on guidelines and what are known as investor overlays, which provide them the criteria they use to originate and sell loans in the secondary mortgage market.

Lots of these mortgage companies have strict guidelines which can sometimes make it difficult for a borrower to obtain mortgage financing. For example on an FHA loan, one company’s debt to income ratios might be overly conservative while another companies’s might be much more relaxed, thus able to close the loan quicker. Another example of an investor overlay is a minimum credit score requirement such as a 640. When selecting the right mortgage company, you will want to ask what their investor overlays are on whatever kind of loan program you are seeking. Ask them up front and don’t be afraid to do so because if that mortgage company refuses to tell you, do not work with them. Your home loan deserves professional integrity.

Here are the questions to ask when selecting the right mortgage company for your home financing needs:

1. What is your minimum credit score requirement? (Note, the minimum credit score requirement is 620 for both a all loans including Conventional,FHA Loan, VA & Homepath Loans)

2. What is your company’s investor overlays and how will they affect my loan? (This is very important because it could impact whether or not your mortgage loan will actually close escrow. If you are looking for a specific loan program, specifically ask them what their overlays are for that particular program.)

3. What is your typical turn time for loan approval and closing? (A decent mortgage company should say at least four days for loan approval if not faster, and approximately 30 days for a close of escrow, anything faster is a huge plus to you as the consumer)

4. How accessible is your mortgage company? (this is the question specifically for the loan officer because you should be working with somebody who is responsive and communicates with you appropriately, not two or three days later)

5. Does your mortgage company offer next day funding or table funding? (this is very important especially if it’s a purchase transaction because of the fact you want to make sure you close escrow by your contract date or sooner otherwise you could end up with being in void of contract and getting hit with per day penalties)

Note: A next day funding and a table funding basically means the loan funds immediately within 24 hours. The difference is a next day funding literally means that the loan will fund the next day. A table funding means the loan funds when the loan documents are sent to escrow. It means the loan literally funds with docs. The other perk is funding a loan when underwriting conditions are not completely signed off, this is done on an exception basis. Almost all private mortgage banks do not have this ability, we do.

The right mortgage company will answer all of these questions for you right up front giving you the obvious choice.

One of perks of working for a great private mortgage bank is being able to offer efficient service and competitive interest rates. For every single mortgage loan I offer, the minimum credit score is 620. We have no investor overlays which means we are able to close loans faster and more efficiently than 85% of the local mortgage companies originating home loans today. We aim to get the appraisal back, then send the file to underwriting with the approval allowing us to have the loan approved and cleared for docs on the same day.

Our typical close of escrow time frame is 20 days. Unlike other banks, our entire staff is paid upon performance of mortgage loan origination. Because of this, each and every single person working on your home loan is vested in making sure your mortgage loan closes on time. My personal cell phone # is 707 217 4000. If you are already working with another mortgage company and you would like a second opinion, contact me Scott.Sheldon@nafinc.com. Maybe you’re thinking about doing a refinance and your curious what the market is? I’d be happy to provide you a no obligation rate quote. You can tell me if you think it makes sense or not. I also can provide you current mortgage rates for santa rosa.

Scott Sheldon can help you select the right mortgage company for your next Sonoma County Mortgage.

Posted in:

RELATED MORTGAGE ADVICE FROM SCOTT SHELDON

When buying a home, it’s natural to want the lowest mortgage rate possible. But sometimes, chasing a slightly better rate from another lender—especially after your offer has already been accepted—can backfire in a big way. Let’s walk through a real-world scenario. You’ve got an offer accepted on a house. You’re working with a lender who has you approved, documents in underwriting, and a 21-day close of escrow in place. Everything is moving forward. Then you hear from another lender offering a rate that’s 0.25% lower, with slightly better closing costs. It’s tempting. But before you make a jump, here’s what you need to consider. Switching Lenders Comes with Time Costs When you pivot to a new lender mid-contract, they’ll need to: Re-underwrite your entire loan, Order a new appraisal, Disclose and sign new loan documents, Submit the file for final loan approval, Schedule and fund closing—all over again. This doesn’t happen overnight. Even in ideal circumstances, the new lender is likely going to need at least 25–30 days to close. If you’re in a fast-moving or competitive market, this is a real problem. Most sellers won’t grant a contract extension just because you’re switching lenders. So, what happens next? A Contract Extension Can Jeopardize Your Deal Asking for a contract extension means the seller must agree to delay closing. But that delay introduces risk—especially if the seller has backup offers or simply wants certainty. They may not grant the extension. Or worse, they could cancel the deal outright and take another buyer’s offer. Even if the seller agrees to extend, your earnest money and negotiation power could take a hit. And for what? A slightly lower rate that might save you $50 to $75 a month? Mortgage Rates Aren’t as Far Apart as You Think Here’s the truth: all mortgage lenders get their money from the same place—the bond market. The pricing differences between lenders usually range from 0.125% to 0.25% in rate on any given day. If one lender seems to be offering dramatically better pricing, the first thing you should ask is: How? Head over to FreddieMac.com and check the average 30-year fixed rate posted weekly. This is one of the most reliable benchmarks for where rates truly stand in the market. If a lender is quoting you a rate that’s well below that average, ask for the details: Are they charging extra points? Is this a teaser rate with a prepayment penalty? Is it based on a different loan product or risky structure? Often, what sounds “too good to be true”… is. Consider the Bigger Picture Think long-term. If you’re financing $600,000, a 0.25% lower rate may reduce your payment by roughly $75/month. But what if you lose the house and have to start over? That monthly savings doesn’t mean much if you’re outbid on your dream home or lose your deposit. Also, remember: you’re not going to keep this rate forever. Today’s homebuyers typically refinance when rates drop by about 0.75% or more. So if rates fall within the next year or two, you’ll likely be refinancing anyway. Instead of paying extra points now or risking the entire deal for a minor monthly savings, it may be better to accept a slightly higher rate—knowing you’ll refinance when the time is right. The Real Risk Isn’t the Rate—It’s the Delay When shopping for a home loan, don’t just ask, “What’s your rate?” Ask: Can you close on time? Is this rate sustainable or based on hidden costs? Will switching lenders delay or jeopardize my contract? A home purchase contract is a binding agreement between you and the seller to perform within a set timeframe. If you can’t meet those dates because you're chasing a slightly better rate elsewhere, you may want to reconsider if now is the right time to buy. Final Thoughts Yes, interest rates matter. But execution matters more. Before making a switch mid-transaction, talk to your lender. Have an honest conversation about pricing, timelines, and strategy. You might find that staying the course, securing the house, and planning to refinance later offers a better path to financial security. Want to Know Your Options? Let’s compare rates and strategies the smart way—without risking your dream home. 👉 Click here to get a custom rate quote today.

The Risks of Chasing a Lower Mortgage Rate

Why Chasing a Lower Mortgage Rate Can Backfire When buying a home, it’s natural to…

Smiling man holding a "Mortgage Approved" sign in front of a modern home and a DSCR loan presentation board showing rental income exceeding mortgage payments.

How to Buy a Home Without a Job Using a Rental Property Loan Strategy

If you’ve got solid credit and a decent amount of cash on hand—but no W2…

A scenic suburban neighborhood in Sonoma County, California, with diverse homes surrounded by lush greenery and rolling hills. Overlaid bold white text reads, “Buying a Home in Sonoma County in 2025: Income, Prices & Market Truths.”

Navigating Sonoma County’s Housing Market in 2025: What Buyers Need to Know

Sonoma County Home Buying in 2025: Navigating Economic Uncertainty and Affordability As a mortgage loan…

Modern house with a 'Sold' sign in the front yard, symbolizing successful real estate transactions. In the background, a clipboard with appraisal documents and a magnifying glass emphasizes the importance of accurate property valuations and working with an experienced lender

New Fannie Mae Mortgage Value Rules: What Homebuyers and Refinancers Need to Know

As of October 31, 2024, Fannie Mae has introduced new requirements that will significantly impact…

View More from The Mortgage Files:

6 Comments

  1. […] I have access to the most accurate mortgage payment calculator as well as current mortgage rates. Selecting The Right Mortgage Company is very important.You can always reach out to me Scott Sheldon Sonoma County mortgage loan lender […]



  2. […] I have access to the most accurate mortgage payment calculator as well as current mortgage rates. Selecting The Right Mortgage Company is very important.You can always reach out to me Scott Sheldon Sonoma County mortgage loan lender […]



  3. […] Federal Reserve intends to keep borrowing costs low for consumers when taking out a Sonoma County home loan. The government also encourages folks to compare mortgage rates when shopping for a mortgage. As […]



  4. […] tell you whether or not we can do a refinance loan or a purchase loan for you. Because I work for a local mortgage company, I can get you an answer on your mortgage loan pretty darn fast usually within 30 […]



  5. […] bring a mortgage company your w-2′s and pay stubs supporting high income. Your income should be no problem right? […]



  6. […] collecting a fee up front, the mortgage company can then take this application fee and pay the appraiser. It’s quite common that some […]



begin your mortgage journey with sonoma county mortgages

Let us make your mortgage experience easy. Trust our expertise to get you your best mortgage rate. Click below to start turning your home dreams into reality today!