OR Does the Home Loan Shopper REALLY WANT TO BE LIED TO? I've been doing loans for a while now (since 1984) here through the good times and Not so Good (3rd time around a bad market, this being the worst obviously) times. But over the past Quarter Century, with All the Changes in Lenders and Regulations, Predatory Laws, The Melt-Down, etc. etc. Thru it All - One Constant Has Remained - The buyer/borrower just seems to WANT to be Lied to? That is the Only Answer that makes any modicum of sense with What I continue thru the years, to keep hearing and experiencing first hand..............
I just got done reading Ken the Mortgage Guy in Georgia's Blog Post because of the Title Line, but after reading it through I Agreed Whole Heartedly with most everything he said. He's no doubt been around a while too or has a good mentor who has.
Here's my most recent story backing up my ongoing feelings on the subject; I get this call in February from a Home Shopper interested in a Pre-Qual for a Loft Condo in Downtown Los Angeles. But one week into communication she texts me saying She Has Put Everything On HOLD for now and will Keep Looking?
So I stayed in touch over the coming months with emails and the occasional text message letting her know I'm still here whenever she's ready. OK, fast forward to two weeks ago; she calls and says she's ready to offer on this Loft and needs a Pre-Qual Letter Asap. I tell her the most expeditious thing to do is complete our secure online loan app. to get this started. She fills out about HALF of it and wants to know where her P.Q.L. is????
I tell her No Mtg. Company can issue an Honest Pre-Qual without knowing her Debt Ratio as she has left All liabilities section Blank, Oh and also put $10 grand more in monthly income than she meant to?? Can you say Red Flag?? Anyway, she's treating me like the enemy from the start; telling me I don't Need all of this info, she's a very busy self-employed business person and all she's asking for is a Simple Pre-Qual Letter.
Upon more careful questioning to draw out where all this Anger is Really coming from toward Mortgage Brokers. She Exclaims; The "Preferred Morgage Company" (translation; Mtg. Lender the builder or Listing Agent is Making her use) Won't Return Phone Calls, etc. etc. etc. etc. AH HA, finally some truth surfaces - the Prospect Has Been Lying to the Mtg. Broker this whole time - This was the 1st moment (I suspected this all along, don't get me wrong as I said I've been at this a while) she'd exposed her Cards. The Prospect was Not forthcoming with the Mtg. Broker! Imagine that? She's already come to me with this Huge Chip on her shoulder toward anything related to Mortgage Agents!
Fast foward to the other day; I issue her Pre-Qual Letter on a Purchase Price of $519k with 15% Down (I put in footnotes that 20% or more d.p. she'd avoid M.I.) and she emails back shortly after, that she now woould also like a GFE for $660,000 as Loan Amount? WHAT???
My Pre-Qual was Timely and Transparent, Showing All Fees Accurately with Current Par Rates Given and 1% Orig. Fee. I then followed up by telling her to Beware if the Preferred or other Mortgage Companies she's also shopping with show much lower rates, and or fees to remember what her Mother/Father told her; If it sounds too good to be true................
Bottom Line; she'd been On me with daily emails for over a week (even though her app was incomplete & trying to get All info needed to do a basic underwriting to Pre-Qual her) to just hurry up and get her the Letter. After I faxed the P.Q.L. to the Prospect on Tues. of this week, I now cannot get a returned Call or email from this person?
One of two things has happened here; A) She just wanted some ammo to use for the Preferred Lender (who by the way she referred to as a bunch of IDIOTS) to negotiate some threat to lower a rate or fee or B) the 5.25% Rate I quoted on the Pre-Qual got trumped by some Low-Baller in the 4's (Not out there as of today's date unless paying thru nose on discount fee!) who will MOST CERTAINLY BUMP HER AFTER APPRAISAL HAS BEEN PAID FOR OR WORSE WAIT TILL THE 11TH HOUR, AND FIND OUT AT THE CLOSING TABLE! When it's Then Too Late to Cry about it to Anyone!! Just like the scenario used by Ken in Georgia. Begs the Question; Is there room in this industry any longer for the Nice Guy/Girl Loan Agent/Mtg. Broker? Lord knows the good one's who are left are Paying the Price dearly for the wreckage of the Bad Apples and the Mess left in the wake of the melt down.
But like I said at the Top - does the home/mortgage Shopper Really Want to Work with an Honest, Ethical Mortgage Broker or DO THEY REALLY WANT TO BE LIED TO? The Prospect Lies to Us, So Why Not Expect it in Return, must be the thought process? In Ken's story He didn't make any money being honest, and I can tell you after 25 years in this industry, the Chances of me and my firm; Pinnacle Mortgage Group, Anaheim Hills CA, Closing this Loan for the Shopper of the Loft Condo in L.A. are Slim to None!
So Do We Have to Play Along and Fudge with Low-Balled Liar Loan GFE's and Pre-Qual Letters to Survive? If so, I'll find another line of work rather than stoop to that level. Not gonna Sell Out Now!! But Gotta Make a Living too - Love to get your take on this; comments, thoughts??
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