Ignorance or confused?
I n the past couple of weeks I have been experiencing some interesting customers. I recently lost a deal to rate whoring. But what was confusing was my competitors lower rate came with $1500 more in closing costs, yet the lower rate was only $25.00 less per month. I pointed this out to the customer, explaining that it would take 60 months to break even, which is a complete waste. I then countered with the same rate and still lower closing costs, but they still went with the other lender because they made the lower rate first. Besides the fact that i was taking a .750 short(I did not tell them that), I informed them about how higher closing costs mean wasted money on trumped up fees. I also spent an hour face to face with them showing them there options and recommending the best option for their needs. As usual with high credit score clients their is no loyalty or respect for a lenders time . I know I sound a little bitter, but when you spend time with a client to help them save money and make a small commission for myself,.50 bps(straight commission) on a $255,000 loan, then they call another lender who just asks what rate they were quoted and then takes a short just to get their business, because all the work was already done for them is annoying to say the least. I think I will start targeting only poor credit clients, they seem to be more appreciative of my time and since I can't charge origination points,only discount points with no number fudging I believe the extra effort to get their loans approved will payoff with alot less rate shopping,maybe. Perhaps someone in the Activerain community can share some tips on countering rate whoring.
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