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"Financing is the Key !!! "

By
Real Estate Agent with KW Elite

     When I launched my real estate career at age 21 , I was very fortunate to have my father as my

mentor . For my first 18 months in the business (as well as much of my life) , I shadowed him on

numerous of his appointments. He personally molded me to become a life long REALTOR .

     Very early in my training , he told me ," always remember that Financing is the Key ! " . Now I

must admit , that while I was a Penn State grad , I had no idea what he was talking about ! By the

time he had said this to me on at least 3 different occasions , I still didn't have a clue ( and was too

embarrassed to ask him). You know tragically many of today's agents are exactly in the same boat !

It wasn't until several years later that I completely understood his statement . Like most new agents,

my business was 90% working with buyers ! He taught me how to qualify them using the 28/36

Qualifying Ratios . Do you know that 50% of agents today can not do this !  Armed with this knowledge

I was now able to help buyers to determine their economic Price Range .

     But I quickly ran into another roadblock , that still plagues buyers today. Most of my buyer

prospects didn't have enough (liquid) Money to buy a house . They were Willing and Ready , but not

ABLE ! My financial friends back in that day were often their parents Home Equity and a tool called

a Blanket Mortgage . Within the next year I would learn about FHA and 95% LTV's and I was off and

running ! As the settlements piled up , I noticed how easy it was to capture buyer loyalty when I

could explain all of their possible financing options . And then it hit me ! My Father's words of

wisdom, "always remember Financing is the key !"

     So what was the take away from my own aha moment (and this blog post's) ? It was taking my

father's advice and amplifying it . What he had been telling me the whole time should have been

more obvious to me ! Financially , the more ways you know to do deals , the more homes you are

going to sell , and the more money you are going to make ! Take Financing courses your REALTOR

Associations offer. Join several of the AR Mortgage Groups to continually sharpen your game .

Why ? Well that's real simple ,  Financing is the Key !!!

 

     $$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

Posted by

 

Michael J. Perry

KELLER WILLIAMS Elite

www.lancaster4sale.com  

 

1280 Plaza Blvd. , Lancaster, PA 17601

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Longtime West Lampeter resident and Lancaster County Realtor!

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Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

WowMichael Perry,  great history and glad you had your dad as a mentor.  Hope you have a great week.

Jan 16, 2016 02:44 AM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Thank you for sharing your post, it is so wonderful to hear that your dad was your mentor. Unfortunately there is not enough of this kind of thinking.

The debt ratio numbers you were taught are certainly very good, but there is a another world out there, currently FHA loan can be approved with a debt ratio to 56%, depending upon credit scores. There is also lots of financing available for clients with credit scores in the mid 500's, but there are a number of factors that come into play.

Jan 16, 2016 04:02 AM
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

your father gave you great advice.  I wish I had started this career  instead of a life ins. one when I was younger

Jan 16, 2016 08:11 AM
John Ferrier
Mortgage Network Solutions, LLC - West Chester, PA
20+ yrs as a consultative mortgage professional

1. We Are!

 

2. As a lender, fully 100% of my transactions are not cash buyers, so yes, financing is the key.

Jan 16, 2016 01:38 PM
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

Michael J. Perry Nice post and great advice from your dad.  Yes, financing is key unless the buyer is paying cash

Jan 17, 2016 09:03 AM
Larry Johnston
Broker, Friends & Neighbors Real Estate and Elkhart County Subdivisions, LLC - Elkhart, IN
Broker,Friends & Neighbors Real Estate, Elkhart,IN

Hi Michael J. Perry , You were fortunate to have your father as a mentor.  Most of the new agents don't have that privilege.  The have to rely on their brokerage to mentor them, which I know isn't always top notch.  Great blog.

Jan 17, 2016 09:50 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

Well said Michael J. Perry , that is an important lesson to learn and practice. I with you on the early start, i started when i was 18 and shadowed for years it seems. Many new agents dont know what 28/36 is never mind how to do it. 

Jan 24, 2016 11:24 PM
Jonathan Hall
William Pitt Sotheby's International Realty - Danbury, CT
Realtor - Danbury,CT Area Real Estate~203-417-0523

Without financing set up, it's all just talk. Funny you mention south of 462,I went to college in York and have some friends out there still

Jan 25, 2016 12:46 AM
Yolanda Cordova-Gilbert
Richmond, TX

I have some buyers that need to learn this! They want it all and only have a near beer budget.

Jan 25, 2016 06:52 AM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

I remember learning how to qualify my buyers and working the numbers and used those front end and back end ratios. They would watch and hold their breath while I did my numbers magic. I would know immediately if this was a good prospect or not and which financing option to take. Those were fun days.

Jan 26, 2016 10:31 PM
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Michael, I too learned how to qualify a buyer early in my career, but have found most buyers work with the lender and I prefer not to know about their financing or numbers.   I just need to know what or that they can buy!

Jan 28, 2016 09:58 AM
Larry Lawfer
YourStories Realty Group - Newton, MA
"I listen for a living." It's all about you.

There are so many keys to real estate and at the start is the ability to do so which is financing.  Financing, I have learned, comes in all sizes, shapes, colors and forms...don't be dissuaded if the normal avenues do not work for your client. There are always alternatives for people who possess all the other attributes of a great Buyer. Thanks for the discussion.

Jan 28, 2016 08:26 PM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Michael - you got great advice and learning how to make the financing packages work is very important to you career.

Jan 31, 2016 09:58 PM
Debbie Laity
Cedaredge Land Company - Cedaredge, CO
Your Real Estate Resource for Delta County, CO

Right on, Michael. Great post and great advice. Know those different financing options. They are tools to get a deal going and to keeping it going. 

Feb 02, 2016 08:27 AM
Roy Kelley
Retired - Gaithersburg, MD

Thanks for sharing some of your successful business practices. 

I do wonder how many real estate agents know now to prequalify a prospect for FHA financing.

Feb 06, 2016 12:54 AM
Robert Vegas Bob Swetz
Las Vegas, NV

Hello Michael ... some great history in your Real Estate business and having your father mentor is a bonus!

Feb 18, 2016 03:53 AM
Hall Joshua
The Lending Hall Inc - Alachua, FL
Private lender giving out loans Nationwide

Am a private lender, giving out loans at 4% interest rate, and i can fund within 5 working days, i currently have funds available to lend, if you want to do business, get back to me for more information at Lendinghallinc@gmail.com 
Cell: 850 724 4608

Thanks 
Hall Joshua

Jun 04, 2016 10:00 AM
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

This post has had over 475+ views to date !!!

Feb 12, 2017 08:08 AM
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Well over 1,000 views 

May 06, 2020 07:58 AM