In Banks We Trust....OR Not....

By
Real Estate Agent with EXP Realty 414-525-0563 57026-90 Broker

Recently, there have been an increasing number of lenders in our market who have "defaulted on their pre approvals." What does that mean ? WHO Does that ?  It means several things....First...the loan officer may NOT  have done a defaultthorough application from the potential borrower.  This can be especially problematic if there is "gifting"involved...the generous relatives had second thoughts...Or that tax return just was not in the amount "imagined"...the reasons are varied ...and the blame, we believe, is a shared "responsibility."  Next in line...Underwriting....when are documents requested/collected? The day of loan comittment is not the day to be verifying divorce decrees, child Debt to incomesupport...additional part time employment...status of debts....that should have done weeks ago...If there is a perceived "issue"...it needs to be brought to everyone's attention for prompt resolution.  Time truly is "Of the Essence" if there is some digging deep research required to have the loan close in a timely manner.

     Third...and Sooooo not Last...let's look at the real estate agent side of things. We are not saying that the Buyer(s) should confess every digit of their financial status to their agent. What we are saying is that the agent needs to prepare the Buyer for the kind of information that the lender will request. Above and beyond that...suggest insurance companies...Offer scanning services or their location. A Buyer's agent in our opinion, does commission Checknot get to write the offer, go to the inspection and wait for closing to collect a check. Be Pro-active....do you have the list of documents that the Lender requires of the Buyer ? Have you asked the Buyer if there are any "hiccups" in being able to supply them ?  Have you checked with the Lender to be sure that everything is in order in a timely manner and that  the dates in the contract can be met ?  We have heard several newbie agents say...."That's not my job..." and our response is..."...and it won't be your commission either if the transaction does not close."

   Do you and your Buyer know the reputation of the Lender ...beyond that ...the Loan Officer ? It is soooo not enough to say..."that's where I, my parents, my friends, co-workers do their banking." BankingBanker and lending can vary greatly in abilities and quality of services. 

   Listing agents...you can't specify which lender the Buyer uses for their mortgage, unfortunately.  What you CAN do...is ask the Buyer to be pre-approved by lenders you know are reliable. We have done this...to learn that the Buyers did NOT qualify for the mortgage on the contract...sometimes under no circumstance and others with the addition of a co-signer.

     Brokers... Train Your Agents !  Lenders ...Train your Loan "officers"...

and Underwriters....we know you are such an independent group...but Please....know that all loan officers are not created equally...you too need to watch the calendar...and  the contract dates.

      Agents...BOTH...listing and selling...be Pro-Active...keep an ever watchful eye on all the moving parts of the transaction you "save" may be your own ! Amen and Women.

       This has been what we hope is an educational reminder post brought to you by Sally K. & David L. Hanson, Broker Associates with EXP Realty honored to be serving southeastern Wisconsin for all things timely in real estate.

Posted by

Sally K. & David L. Hanson, ABR, CDPE, CSS, e-Pro,ILHM, REDS


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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Barbara Todaro 04/07/2019 07:02 AM
Topic:
Real Estate Best Practices
Tags:
timelines in mortgage loans
qualifying buyers for mortgages

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Ambassador
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Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Sally and David- the underlying theme in your last two posts was proactive. Doing this can help prevent a lot of the oops moments that can occur. 

Apr 07, 2019 06:26 PM #23
Rainmaker
3,166,628
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Indeed Aunt Kathy Streib it has been that kind of time...and if I don't fall asleep will do one more for the road...it's what you have to be to have "it happen" as it should for the greater good of our clients.

Apr 07, 2019 06:29 PM #24
Rainmaker
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James Dray
Fathom Realty AR LLC - Bentonville, AR
Exceptional Agents, Outstanding Results

Morning Sally.

Congratulations on the feature.  Pity, new agents are not taught that early on.

Apr 08, 2019 01:40 AM #25
Rainmaker
1,932,221
Andrew Mooers | 207.532.6573
MOOERS REALTY - Houlton, ME
Northern Maine Real Estate-Aroostook County Broker

Local lenders work best in my experience. I find faster turn around with appraisers who are limited in number and lots of other reasons like protecting the local economy, better service, etc. But brand new lenders like agents with the ink still trying on their license, they lack experience Sally K. & David L. Hanson .

Apr 08, 2019 02:58 AM #27
Rainmaker
1,389,909
Kat Palmiotti
Grand Lux Realty, Monroe NY, 914-419-0270, kat@thehousekat.com - Monroe, NY
The House Kat

Being proactive really is important - if buyers work with mortgage professional we know are excellent at what they do, it definitely makes the process easier.

Apr 08, 2019 03:05 AM #28
Rainer
128,861
Robin Wells
RAW Chimney Sweep and Inspections - Penetanguishene, ON
Giving Peace Of Mind One Chimney At A Time

Thanks for post.  And yes there is nothing that makes a potentially stressful situation go better than does a good agent.  But banks are not our friend, their goal is to make as much money as they can for shareholders - which translates to virtually zero risk at an acceptable rate of return.

Apr 08, 2019 04:31 AM #29
Rainer
486,398
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton & rest of Maryland

Dear Sally and David,

If the vendors are known entities with a good service record, you can relax a little bit, but others need to be babysat at every step. Just met another lender, who did a fantastic job. He'll be on the recommended list. This is a rare occurrance.

Apr 08, 2019 06:17 AM #30
Ambassador
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Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

Oh, you are spot-on, Sally! And, one thing that I chuckled at is knowing what is needed for the process. I have heard over and over again from agents, "I don't discuss financing with buyers." WELL THEN, how does one prepare them for the process and what to look for in a lender?! 

Like you said, we don't need to know where there every dollar is but, we DO have to have that conversation with them. How else do we know to which lender to refer them to find the best product that meets their individual needs? 

Apr 08, 2019 06:39 AM #31
Rainmaker
3,166,628
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

EXACTLY Debe Maxwell, CRS they don't get mortgages every day...lenders vary in the programs they offer...AND in the expertise of their staffs as well.

Apr 08, 2019 06:43 AM #32
Ambassador
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Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

In our investment real estate business we are careful about who we work with. This can mean using someone who is not a local lender. We have a Los Angeles team that specializes in investors and we are grateful for their competence and ethics.

Apr 08, 2019 08:58 AM #33
Rainmaker
1,214,476
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Ohhhh where to begin, Sally K. & David L. Hanson .... each and every point you make is so spot on.  My favorite?  You're stressing of the importance of pro-active actions and thinking.  For me that one thing is THEE difference between working with a real pro and not, whether agent or lender.  Acting and thinking in a pro-active manner addresses issues before they become big problems.

Great post!

Gene

 

Apr 08, 2019 09:47 AM #34
Rainmaker
3,166,628
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Thank you Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi  not the training for many agents

Apr 08, 2019 09:52 AM #35
Rainmaker
2,189,278
Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

I try not to discriminate against buyers who seem on the fringe of qualifying. You know the type, the ones who submit an earnest money deposit less than the standard amount of 1 to 3% of the purchase price, like $500. First thing we think is oh, they don't have any money. We jump right to: if they don't have any money, they probably have bad credit, which is not always a true statement.

If the lender is also the buyer's agent, well, that could be a double-edged sword. Probably can't do either job very well, is what I find to be true most of the time. I might suggest that the seller ask for a DU or we get the buyer preapproved by a reputable lender we know, and half the time, sure enough, they do not qualify.

Apr 08, 2019 12:47 PM #36
Rainmaker
1,482,777
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

Good evening Sally K. & David L. Hanson, it's best to be pro-active, prepare our buyers on the financing side as well as the entire transaction. It's our job to ensure everything goes smooth. Well deserved feature!

Apr 08, 2019 05:31 PM #37
Rainmaker
580,675
Carolyn Roland-Historic Homes For Sale In Delaware and S. Chester County PA
Patterson-Schwartz Real Estate - Wilmington, DE
Carolyn Roland, GRI, CRS

There is SO much to keep track of after an offer is accepted. But we are going to be replaced by computers, right? Like they know how to get a WDI treatment or fix a foundation crack in time for settlement, right?

Apr 08, 2019 07:01 PM #38
Rainmaker
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Amanda S. Davidson
Amanda Davidson Real Estate Group - Alexandria, VA
Alexandria Virginia Homes For Sale

Sally and David, I cringe when I ask a buyers agent if their clients are well qualified and they say they don't talk to them about finances. You're right, we may not need to know where every dollar is but, that doesn't mean there should be no conversation about financials. Aside from a few exceptions, there is no reason financing should ever fall apart and when it does I've always found it's because due diligence and questions were never asked. 

Apr 09, 2019 04:58 AM #39
Ambassador
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Eleanor Thorne
Equity Resources - Cary, NC
Equity Resources 919-649-5058

EVERYONE needs to be invested in providing the Best Experience for the Buyer and the Seller.  I can't tell you how many times we pre-qualify someone, pull their credit - and ask them for documentation.  2 weeks pass... crickets.  Nothing comes back.  We talk to our referral partners at least once a week to update them on what the progress is.  This is spot on Sally K. & David L. Hanson - thank you!

Apr 09, 2019 08:40 AM #40
Rainer
122,730
Susan Hale
Re/Max Realty of Defiance,Inc. - Defiance, OH
Re/Max Northwest Ohio Realtor

Sally K. & David L. Hanson congrats on your feature blog!  Consumers and our spouses don't realize all the details we are constantly juggling in our minds in this business every day. We definitely multi-task as Realtors.

Several local mortgage companies provide informational outlines for their consumers and us Realtors to share with Buyers.   Covered are inspection check lists of potential house conditions that could affect appraisal results for certain loan types, not opening any new credit card acounts during house purchase process, do not co-sign any loans, do not make any new large purchases like new furniture for the new home or another vehicle,etc.

We all need reminders periodically how to be the best Realtors possible. Great post!

Apr 09, 2019 10:27 AM #41
Rainmaker
2,415,688
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

What people don't understand is that banks have the golden rule i.e. the gold and they rule and as such they are a type of dictator disguised as otherwise. All decisions are made in bias  & I get it. The question is does the buyer get the loan

Apr 09, 2019 11:23 AM #42
Rainmaker
391,725
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Your post is so important. Agents need to be on top of things and be proactive.

Buyers need to be upfront and on time with document submission.

Lenders need to by responsive and thorough.

So many things to make a transaction run smoothly. It takes a team working together

Apr 11, 2019 04:10 PM #43
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