Zillow survey: Buyers still unclear on loan process

Potential homebuyers are racing to apply for loans, but many incorrectly answer basic mortgage questions, according to a new survey by Seattle-based Zillow.

For example, one-third of buyers (34 percent) believe all lenders are required by law to charge the same fees for credit reports and appraisals.

“Buyers should always shop multiple lenders and compare rates and fees and read lender reviews in order to find the best loan for their situation,” said Erin Lantz, director of mortgages for Zillow.

One-third (34 percent) of first-time homebuyers are not aware that it is possible to get a home loan with a down payment of less than 5 percent.

And, 26 percent of homebuyers incorrectly believe they are obligated to close their loan with the lender that pre-approved them, the Zillow survey revealed.