Just when you've positioned yourself to switch into cruise control, when you've acknowledged and embraced all of the current vagaries of the real estate market, another challenge pops up out of left field. To help you succeed, I can say nothing other than, “Learn to deal with it.” My own best far-reaching strategy is to give you a heads-up, and offer alternatives for dealing with the latest, greatest potential obstacles. The old adage holds true: Forewarned is forearmed.
So here's what's happening – and needs to be on your radar – right now. Are you experiencing an upsurge in clients having mortgage loan rejections? There are lenders who are, according to Inman News, rejecting 50% (or more) of their loan applicants – after the applicants have paid for an appraisal, and in some cases after they have paid a nonrefundable upfront fee to the lender. The overall rate of rejection is far higher than it was before the financial crisis.
The rise in late-stage rejections has been due in part to the more restrictive underwriting climate that arose after the initial financial crisis. This includes not only more restrictive lending terms but also tougher enforcement of the rules (including more extensive checks of closed loans for compliance).
Loans that fail compliance checks may have to be repurchased by the originators, which is very costly. Underwriters entrusted with responsibility for assuring that loans are not returned from buyers on grounds that they did not meet the requirements almost invariably err on the side of rejection.
It's time to diversify your thinking if you're going to stay in the game. Are you experiencing an increased in client mortgage loans being rejected? Leave your comments below and tell me…What are your thoughts about late-stage mortgage loan rejections?
Talk to you soon.
Coach Patti
About Coach Patti Kouri:
Coach Patti, the owner of Accelerated Performance Coaching Inc., and The Real Estate Game®, strives to maintain an atmosphere of community, connection, and harmony by becoming your resource base to enhance and enrich your personal and business life. Coach Patti was voted one of the ‘Top 50 Most Influential Women In Real Estate Leadership in 2008’ by the 2008 edition of the Swanepoel Trends Report. www.CoachPatti.com and www.TheRealEstateGame.com.
Image: hans.gerwitz
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