I was reading yet another blog post on this topic from top Realtor and blogger, Neal Bloom from Florida: WHAT IS THE USE...JUST PUT ME OUT OF MY MISERY!
Neal discussed a bad transaction, that he had to deal with a bad loan officer. The responses to his post had several that were quite stimulating. Jeff Belonger a top loan officer from New Jersey weighed in heavily on the conversation. Jeff's responses give you a look at how a quality loan officer does business.
I have written a few posts on this issue and have responded to more than I can count written by others in our industry.
If I were in the lending industry I would be doing exactly would the Realtors do. Realtors push for law changes that require high standards for our industry and improved laws to better protect the public. Realtors have a code of ethics, not everyone follows it, but we have a procedure for dealing with them. Did I read this stuff in a magazine? No I have been to the state legislature and city council lobbying with fellow Realtors to get improvements to our laws.
I just do not see that coming from the lending industry. If you do not police your lending industry better, you end up with what we have now; the Wild West and public's interest is not being served as well as it could.
After giving this a lot of thought, I have concluded that the one major difference between the lending industry and the Realtors is that we have two Realtors in almost every deal. If you have a bad real estate agent he or she does not operate in a vacuum. There will be another agent in almost every deal that has to work directly with them. A good agent will overcome many of the deficiencies helping all involved. If so required, hopefully the agent on the other side will take some form of action against the bad agent. There is a check and balance to some degree and a process for taking corrective action both within the industry and through government.
That is not the case in the lending side. There is only one loan officer in every deal. Top loan officers in the area do not have to deal with them directly. They may hear stories about the wildest of them, but never are involved in their dirty transactions. The closest thing to dealing with them is when they get an occasional client stolen through deceptive practices. (That is a topic for an entire blog post on its own.)
When a Realtor or a client has an issue with a loan officer there is no easy action to be taken, short of getting state licensing involved. The lending industry has no grievance committee; no organizations to self police their industry, no code of ethics.
Before I end this discussion I want to add two thoughts.
- I have received many pre-qual and pre-approval letters from lenders that are worthless. They claim to have pre-approved buyers fro a loan to only find later that the buyer's are not credit worthy. They cause sellers, the Realtors, the escrow companies and everyone involved a lot of wasted time and money. There should be some recourse.
- I have had clients get a GFE (Good faith Estimate) in writing at the beginning of the process, to only have the lender pull the big bait and switch at the end of the process, when the client is so deep in the sale they either take it or lose the home.
OK I vented enough. Feel free to share stories with examples of good and bad loan officers. Also please add any ideas on how this situation can be improved.
You know what I noticed? Not too many people saw the your last request in your blog....
for the photo of the "new you" and a 
for the post - so hear they are!
I agree that the lending industry needs to have higher standards. A federal exam, as well as individual state exams should be required. I think the "proctoring" of many exams leaves a lot to be desired as well. It is depressing to see incompetent people representing the industry in which I work.