Experience vs Knowledge - Which would you rather deal with?

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Mortgage and Lending with Social Media - Infinity Home Mortgage Company, Inc

 

Experience vs Knowledge

 

How many times have you heard someone boast that they are very experienced and or are very knowledgeable. In my opinion, that sounds like a great combination. Gee, I have been in the mortgage industry for almost 18 years and I think I have tons of experience, especially with FHA loans.  And if I used my total years in this industry as an opener, it could be assumed that I would be a very good choice for both experience and having knowledge in regards to FHA loans and or mortgages. But let's break this down some. Can someone that is not very experienced have lots of knowledge?  I think so. I know I did when I first started, because I applied myself and wanted to learn, to be the best of the best.  One argument could be made that you can gain knowledge through your experiences. I am a firm believer in that statement, because that is where I have gotten half of my knowledge on FHA loans. But let's define both words.

 

 

knowledge of FHA loans

 

Knowledge is defined by the Oxford English Dictionary as (i) expertise, and skills acquired by a person through experience or education; the theoretical or practical understanding of a subject; (ii) what is known in a particular field or in total; facts and information; or (iii) awareness or familiarity gained by experience of a fact or situation.

 

Experience as a general concept comprises knowledge of or skill in or observation of some thing or some event gained through involvement in or exposure to that thing or event.

The concept of experience generally refers to know-how or procedural knowledge, rather than propositional knowledge: on-the-job training rather than book-learning. Philosophers dub knowledge based on experience "empirical knowledge".

Both definitions from Wikipedia.

 

 

 

As we can see, both experience and knowledge can be intertwined. So, experience or knowledge?  Here is a great example.... I picked up a new client in Virginia a few years ago who was using a local loan officer who had 30 years of experience. He missed their settlement date on a FHA loan in which he had 30 days to close their loan.  She started to search online and came across some of my blog posts, and chose me because she thought I sounded knowledgeable.  After reviewing her information, I said we have some work ahead of us, but that it can be done. I ended up closing her loan in 9 business days. At that time, I only had about 15 years of experience to his 30 years, but I considered myself extremely knowledgeable and understood the process very well. I think this is the problem in many cases, those not understanding the process, no matter what kind of work it is. And if you read the definition of "knowledge", it says, "the theoretical or practical understanding of a subject." 

 

 

 

Summary : One of my main points that I wanted to get across is don't always fall for the person that says they have years and years of experience.  In my opinion, that doesn't mean anything at times.  So, how can you tell if someone has the knowledge?  It can be chancy, but read up on them, if they blog often.  Google their name.  Make a list of important questions that you think you should be asked as the consumer.  And then compare that person with others, by making a list and see if they ask you the same questions as the others.  Don't even hesitate to interview that person and the others and ask them questions. Hey, when it comes to buying a home and or applying for a mortgage, this will probably be one of the biggest investments in your life.  Take it seriously and just not assume that you are in good hands or because someone told you that they would take care of you. Those are just "feel good" statements. So, if you had to choose one over the other, which would you rather the other person have, knowledge or experience?

 

 

UPDATE : Please read this comment by Judi Boad   - Comment # 2 -  She makes an excellent point that I failed to mention. Some people using their past experiences could cause more harm than good, if they learned incorrectly or learned from their previous experiences, thinking that it was the right way. Please keep this in mind.

 

 

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Experience & Knowledge at its BEST !!!

 

 

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For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

HUD

 

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

 
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- FHA Loans - USDA Loans - VA Loans -

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- Conventional Loans - 203 k loans -

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Experience & Knowledge at its BEST !!!

 

 

Follow me on:

Mortgage Myth Busters

 

______________________________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

HUD

 

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2011 by Jeff Belonger of Infinity Home Mortgage Company, Inc

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Rainmaker
177,160
Leander McClain
North East, MD
Cecil & Harford County Realtor

Jeff,

You are 100% right. So many people bank on their number of years versus their experience.  Their are some people who have been in the real estate industry for 30 years and they stopped learning after year 1.  Others learn something new every year.

Thanks for reminding us

Have another great day

Leander

Jun 11, 2010 03:38 AM #1
Rainer
178,611
Judi Boad
SOLUTIONS REAL ESTATE - Scottsdale, AZ

Hi Jeff,

You mentioned that experience can bring knowledge, However, it doesn't necessarily. Someone can experience the same disastrous mistakes year after year and not gain knowledge from them.

For myself, I would choose to have knowledge AND learn from my experiences. I think the combination is what makes us stand apart from the rest!

Best regards,

Jun 11, 2010 03:58 AM #2
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Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

 

LEANDER... I just wanted to put this out there as food for thought, for others to just think about this and not always assume.  thanks

JUDI...  . I agree with your comment... in my opinion, one could easily say that there are many ways to look at this. But if I stated others, this post would have been longer and boring.  Overall, you make an excellent point, that ones experience could lead to disasters if it's the wrong way, the wrong method, the wrong application... etc, etc..  thanks for mention this, because I am going to add this part now.. thanks

 

Jun 11, 2010 04:27 AM #3
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Larry Bettag
Cherry Creek Mortgage Illinois Residential Mortgage License LMB #0005759 Cherry Creek Mortgage NMLS #: 3001 - Saint Charles, IL
Vice-President of National Production

I agree with you, but I will say that if you're prosperous in this market, the years of experience probably does count for something.  In other words, you need to have the knowledge to be successful in this industry today.  Having said that, I fully agree with you.  Just because you're in the industry today, doesn't mean that you have the knowledge.  I see people all the time that are in the business.....but fully on their way out....mostly due to the fact that they don't have the knowledge to build a great business by serving their clients.

Jun 11, 2010 04:39 AM #4
Rainmaker
592,907
William J. Archambault, Jr.
The Real Estate Investment Institute - Houston, TX

Jeff,

One of the first things I learned in real estate was the saying: "He has 6 months experience 20 times." There is no better way to explain some people! Longevity alone does not make anyone competent, with out relevant experience! (So many in real estate and mortgage lending stop learning at or before they have 6 months tenure.)

Education alone does not make anyone competent! When I took aviation ground school in college the instructor would not let me take the test because I'd never flown! He believed that education alone was not enough! (I met him at the airport 3 hours before the test, we went flying. He let me take the exam, with an hours experience, I aced it! Half the class didn't and they all had a lot of flight time, I'd have flown with most of them.)

Given the choice between someone with real estate education and limited experience and someone with limited education in real estate, but lots of experience, I'll go I'll go with the educated one! On the other hand I want an experience pilot. I chose the educated REALTOR and the experience pilot for the same reason, survival!

So many also over look the non-homogeneity of real estate and lending! Look at us. I've got well over twice the experience you do and I'll bet I've taught more real estate and lending classes than you've taken, but when it comes to SFR-FHA, I'll defer to you every time! Why, because with regards to SFR-FHA, you've got more relevant experience and education.

In real life a person has to be judged on the whole of their experience and education, relevant to your exceptions!

The wonderful thing about real estate is if you don't have the experience or education you can hire it! Consumers hire professionals for that reason, and hopefully professionals lacking specific education or experience hire consultants.

Bill

Jun 11, 2010 05:17 AM #5
Rainmaker
99,135
Gerry Suarez Jr.
Jet Home Loans NMLS 1660135 - Maitland, FL
FL Mortgage Guru

Very well said Jeff and Bill. It's the combination of both that will best serve any customer, but how can they assure themselves that someone is experienced and knowledgeable?

Like Larry said, to still be in the business these days does count for something. It's good that customers thmeselves are researching more and trying to educate themselves better because that will assist them in choosing the best qualified provider.

Maybe the National Mortgage License will also be able to help borrowers choose between those who take their work seriously enough to license themselves and other bankers that don't. By virtue of the continuing education requirements alone, it will stand to reason that Licensed Mortgage Loan Originators will be the better educated...

Great post Jeff!

Gerry Suarez, Jr.

Your FHA Loan Pro!

Jun 11, 2010 05:29 AM #6
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Paul McFadden
Paratex - Seattle, WA
Pest Control, Seattle, WA.

Jeff: My boss always says that knowledge is king. I agree with that. These days with all the changes we're all starting over. What separates the men from the boys is what we know. Thanks and sorry your Flyers got beat. What a great run!

Jun 11, 2010 05:29 AM #7
Rainer
357,087
Randy Dodd
Rosanna's Realty - Abilene, TX
ePro, GRI, TAHS

Some of both would be a good thing to have. With one comes the other.

Jun 11, 2010 05:33 AM #8
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Larry Bettag
Cherry Creek Mortgage Illinois Residential Mortgage License LMB #0005759 Cherry Creek Mortgage NMLS #: 3001 - Saint Charles, IL
Vice-President of National Production

Paul....I agree with everything you said here, except being sorry that the Flyers lost.  Go Hawks, Go!

Jun 11, 2010 06:02 AM #9
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Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

 

LARRY... . I will semi disagree, just because you have gotten by now or are still in this market, doesn't always mean that you have made it on your own merrits and such. I some people that shouldn't be in the business, yet they have a spouse who has a good job and good income... so they can still play in the sandbox with the others still... or just happened to have a good cushion or have money coming in from other sources...  just food for thought..

BILL... EXCELLENT... this could have been my blog post instead. well said..  I also wanted to use the example of doctors... you could be book smart, full of knowledge, but I would be very leary if you didn't have much experience in something difficult.  Hence the distinction that you mentioned, that in real estate, it's not always about the experience, but just having the knowledge.

GERRY... I will always feel like it is a combination of both... but like I said, I will still semi disagree on what Larry said based on the fact that I still think many will be in this business because of luck, or having the backing of someone else... OR... something that I forgot to mention... what about those banks that are Federally Charted, that their loan officers can by-pass the educational stuff, the licensing... and just spit out quotes, not knowing what they are truly doing.  hhhhmmm  In any case, thanks for the polite compliment..

PAUL.. I agree...  and as I tried to explain, I think a combination of both is the best... but you do need the knowledge and the understanding of the process more than anything. And thanks about the Flyers..

RANDY... . I think most of us would agree a little bit of both would be great...  but which one would you want over the other?

LARRY.. . go back to your Hawk hole... hey, we lost, but it was a great series and a great run... it will be tough for either team to get back to the finals.  thanks

 

Jun 11, 2010 08:29 AM #10
Rainer
138,818
Paul Silver
Tiverton, RI
Rhode Island full service real estate firm

This argument goes on in the real estate agent world as often as in the loan officer world... I hear of so many agents saying theat they are great because they have been in the business for XX years, but then find that they are advertising a house as Waterfront, when in fact it is water view, or, as happened today, we get an offer, accompanied by a pre-approval, stating that the loan will be FHA, but that the buyer requires $5000 in seller concessions for closing costs on a house that they are offering $110K for... I believe FHA only allows 3.5% in closing costs, making this offer self-contradictory... for me, it is not a negotiating point to ask for the impossible sop that you can give it up later...

I have seen agents with many years experience fail on so many counts of the ttraqnsaction that it is stupifying... and I have seen new comers to the business who take it seriously, study up, and run circles around the "experienced" agents... not always, but often enough...

Jun 17, 2010 04:58 AM #11
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Cindy Jones
Integrity Real Estate Group - Woodbridge, VA
Pentagon, Fort Belvoir & Quantico Real Estate News

Jeff-there are a lot of agents with years of experience who haven't kept in touch with the reality of today's market.  They refuse to touch a short sale or cross the threshold of a foreclosure.  Transparency is helping but it is also creating the illusion that some agents are far more successful in their current business than they are in reality. 

Jun 17, 2010 06:19 AM #12
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Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

 

PAUL.. I agree completely, hence why I decided to write this post.  It angers me when someone uses years in the business, yet they are barley average at best... in regards to the seller help for FHA loans, it is still 6% seller concession, until congress votes in the 3%.  thanks

CINDY... . I know this... both real estate agents and loan officers.  Even though so many loan officers think the licensing requirements, getting tested, etc, etc is a great thing, I don't think so still.  The tes doesn't go over many examples, yet it goes over law and acts of such...  you could still pass the test and it still wouldn't mean that you truly know how to originate a FHA loan properly.... some scary stuff.  thanks

 

Jun 17, 2010 07:16 AM #13
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