The line from a song, by whom I can't remember, has been running through my head lately. Why, I do not know. Except one of the issues I'm experiencing are prospective buyers, here in Greenville NC, ARE NOT TALKING.
This has been a year of massive change for the mortgage industry. I get a report monthly of the number of loan program guideline changes we've had and most months it has been over 100 changes a month.
We need prospective buyers consulting with lenders to determine what they must do to qualify for a home loan. I've seen reports, on several occasions, that 40% of the sales in most markets are First Time Home Buyers.
These first timers are hearing on the media, "banks have no money to lend". I can't speak for every lender, but I have never seen a day or moment when we did not have money to lend. Is it tougher to qualify? To be sure, and that's my point. We need everybody talking!
For instance, with the changes in down payment requirements (click here for my post on coming changes with FHA) prospective buyers need to be prepared. I don't even want to think about the number of 100% home loans we funded in Pitt County over the last few years. We can debate whether that was good or bad and I welcome comments on that subject.
The fact remains, as a mortgage loan officer, if I can get a client beyond credit and debt-to-income issues, then invariably the obstacle is cash for closing. On the other hand, if the client has plenty of cash we can overcome a lot of credit and debt-to income issues. Unfortunately I see far more people that are cash insufficient than with cash abundance.
My concern is if prospective buyers do not understand what it takes to become qualified for a home loan then market stabilization or a market rebound (Oh, Happy Day) is going to be further delayed. I predict that many prospects will be six months, a year, maybe a year and a half away from qualifying just on having enough cash for closing alone. If these leads wait until they hear more positive news from the media, if that day ever comes and surely it will, then we will still be six to eighteen away. Can we afford that kind of delay with a major portion of the segment that represents 40% of our annual market?
This is a Call To Action to compel every prospect, no matter what they tell you their time frame is, to schedule them with your preferred lender a mortgage consultation. You do have a preferred lender, don't you? Your not letting your prospects "talk all this stuff" with just anyone, are you?
We became spoiled to the idea, that a buyer indicated interest and "great let's go" and be under contract in a couple of days. Those days fostered a transaction mentality. Today the emphasis is relational. Consultative relationships coupled with comprehensive lead follow up will separate the survivors from the pack.
Stay tuned for more to come.
My goal is to help you serve more customers, save time, and make more money
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