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while taking a home loan I heard it's not a good idea to take from central bank like chase etc?

I heard from people it's not a good idea to get money from the central bank like chase etc ..I don't get it is there any specific reason for that?
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August 03 2012 - Highland
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Answers (3)

The disadvantages have been well described. 
One advantage with the larger institutions is that it might be easier to get a Home Equity Line of Credit (HELOC) if your loan is placed with one of the banks. They will frequently eliminate the upfront costs (appraisal, escrow etc.) if you have your accounts "in house."  This also makes online banking a little more efficient if the accounts are at one institution.
I wouldn't ignore them, but I'd try to go through a broker who will wholesale the loan.  You don't pay any more for the broker doing that.  Once you have the loan, add a HELOC if you want to.
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August 03 2012
Profile picture for B Mike West
The only thing that I can think that someone told you that is because when you go directly to a bank they can only offer you their own loan programs. A mortgage broker can get you a loan from many sources and may have a loan that better fits your specific situation. So, you have the option of calling every bank in town and wading through their loan programs and underwriting guidelines, or working through a broker who will do that for you.  I guess it depends on how you like to spend your time and how sophisiticated you are in financial matters.  It can be dry, boring work.

One more point. The Chase business model is that they only work retail--meaning they only work with the borrower directly.  Most of the large banks work both retain and wholesale--meaning that they also work with mortgage brokers and pay those brokers a commission.  Also, brokers have access to sources that only work through brokers, providing a far greater number of options.
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August 03 2012
Yet another advantage of having a buyer agent to represent you! Agents build relationships with lenders, some of which may be in big banks, others who are with other direct lenders or who are brokers. The point is that these contacts have to deliver what and when they promise or they soon find that the agent goes elsewhere.
If you are dealing directly with a bank, you really don't know if (or when) they will deliver and your agent has no leverage with a loan agent he does not know.
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August 03 2012
 
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