Southeast Mortgage was invited to become the Mortgage Resource for The Northeast Atlanta Metro Association of REALTORS®, NAMAR. NAMAR understands that sharing a code of ethics is critical to our client's trust and our continued referrals from past clients.
Matching the client's needs to the best product based on a good conversation is critical. The right house and the right financing option ensures a good experience. A good experience ensures your client shares it with a friend.
As a Fannie Mae & Freddie Mac lender, we have our own battles with firms looking for short cuts. Alliances, Partnerships etc. may appear beneficial to REALTORS; however, what will your client's think when your relationship is mentioned on the front page of the news paper as RESPA issues indictments? Reputations are critical in selling the most important transaction in our client's life.
REALTORs that accept these payments (high rent, marketing, etc.) need to look deeper into how this affects their clients. REALTORS and Clients ultimately loose under these arrangements. To cover the payments REALTORs accept, the financing provider generally pushes programs that have the highest yield. The higher yielding programs are generally the ARMs with or without a prepayment penalty. Generally with so they can cover the teaser rate and ensure enough time to forgo early payoff penalties.
ARM's have their place with individuals that have rapidly increasing incomes; however, teachers on fixed incomes cannot support the payment increases associated with ARM's nor can they pay the hefty, $6,000, prepay to get out. If the mortgage lender listened to the client story without concern for covering kickbacks, the client would get the right mortgage product. If a mortgage provider sells 98% ARMS, this is a red flag!
REALTORs have a code of ethics and my experience is they follow it. If you do a great job finding your client the right house and the mortgage professional follows a cost recovery strategy, who will the client blame when the payment goes up or they face foreclosure? Not the mortgage provider, they will blame the person referring the mortgage provider, YOU.
I attend a lot of social functions and I can assure you the bad stories are told 10:1 over the good.
With the slower market conditions we all have relied on our solid referral base to maintain sales. Great service that exceeds a client's expectation ensures they tell their friends and family. RESPA criminal investigations take time; however, if you stay informed by reading the mortgage news the number of mortgage and real estate companies facing severe penalties and sentences have increased dramatically. As foreclosures increase due to the widely discussed ARM re sets, HUD will get more aggressive due to pressure from representatives. See HUD link below.
Our client's need us and we need each other to create strong referral chains.
http://www.hud.gov/offices/hsg/sfh/res/res0607b.cfm
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