how to tell a lender you went with someone else

Daniel Parker

2 min read

·

04-02-2025

1

0

Share

How to Tell a Lender You Went With Someone Else

Choosing a lender for a significant purchase like a home or car is a big decision. Sometimes, after comparing offers, you decide to go with a different lender. Knowing how to politely decline a lender's services is crucial for maintaining professional relationships and avoiding any potential negative consequences. This guide outlines the best approach.

Why You Should Communicate Your Decision

While it might seem easier to simply ghost a lender, it’s always best to communicate your decision. Ignoring them can damage your credit score (though this is rare), damage your reputation, and leave a bad taste in their mouth— potentially harming your chances of working with them in the future. A brief, polite explanation demonstrates respect for their time and effort.

The Best Way to Tell a Lender You Chose Another Option

1. Timing is Key: Contact the lender as soon as you’ve made your final decision. Procrastinating only makes the conversation more awkward.

2. Choose Your Communication Method: A phone call is often the most effective way to convey your message personally. However, an email is acceptable if you prefer a written record or if you're dealing with a large institution.

3. Keep it Brief and Professional: Avoid lengthy explanations or justifications. A simple, straightforward message is sufficient.

4. Express Gratitude: Begin by thanking the lender for their time and assistance throughout the process. This shows you appreciate their work, even if you chose a different option.

5. Clearly State Your Decision: Directly and politely inform them that you've decided to proceed with a different lender. No need to over-explain.

6. Offer a Concise Reason (Optional): If you feel comfortable, you can provide a brief, neutral reason—for instance, "We found a lender offering a better interest rate." Avoid negativity; focus on the positive aspects of your chosen lender.

7. End on a Positive Note: Reiterate your appreciation and wish them well. Ending on a positive note leaves a good impression.

Example Email

Subject: Loan Application Update - [Your Name]

Dear [Lender's Name],

Thank you so much for your time and assistance with my loan application. I appreciate you taking the time to explain the process and answer my questions.

I wanted to let you know that I've decided to move forward with a different lender. They offered a slightly better rate that better suits my current needs.

Thank you again for your help. I wish you all the best.

Sincerely,

[Your Name]

Example Phone Call Script

"Hi [Lender's Name], this is [Your Name]. Thank you so much for your help with my loan application. I really appreciate the time you spent explaining everything. I wanted to let you know that I’ve decided to go with another lender because they offered a better interest rate. Thank you again for your assistance."

What Not to Do

• Don't ghost them: This is unprofessional and could have unforeseen consequences.
• Don't be rude or insulting: Maintain a respectful tone throughout the conversation.
• Don't provide excessive details: Keep your explanation concise and to the point.
• Don't burn bridges: You never know when you might need their services in the future.

By following these steps, you can gracefully decline a lender's services while maintaining a positive professional relationship. Remember, honesty and courtesy go a long way.