Q: When we closed on our home, we were shocked at some of the fees we had to pay that we didn't know about.

We signed papers anyway because we were down to the deadline on our contract. We chose this lender on the Internet because it looked like they had the best interest rates. Now I'm not sure what we got. How could we be better prepared next time?

A: Choosing a lender is just as important as choosing the right real estate professional. The wrong decision on either one can cost time and money, plus a lot of stress. I prefer to deal with local banks and mortgage brokers that I have had good results with in the past. My experience has not been good with loans available in "cyberspace." My clients have ended up with expenses they didn't really anticipate, rates that were not as quoted, and even serious problems with the transaction itself.

It's important to understand that the lender "calls the shots" in most transactions. Without the lender's agreement, most buyers can't buy. Without meeting the conditions placed on the loan by the lender, the deal can't close. It can be frustrating dealing with Internet lenders where there is no single loan officer responsible, nor any physical location to visit.

The government requires many "truth in lending" documents to be given to buyers. These documents inform borrowers about the fees they will be paying, and other facts. Sadly, these documents are not simple and straightforward, and are even confusing. A good loan officer will walk their clients through these forms so that the lending process is clear. Internet lenders do not offer this kind of service.

It is possible that once you add in the cost of any surprise fees, or changes in the points being charged, you could have done just as well with a local lender. There should be no suprises when you reach the closing table. In the long run, I would rather see my clients work with a trustworthy local loan officer or mortgage broker who can sit down with them and explain the entire process.