Let A Pro Handle It (No, really, please)

Mortgage and Lending with Mortgages in AZ, CA, CO, DE, FL, GA, MD, MT, NC, NJ, NV, OK, OR, PA, SC, TN, TX, UT, VA, WV NMLS #138061 MMCD #1141

Let A Pro Handle It


This is a post about referrals.  I'm licensed in 20 states, and my team has an additional 3 (Idaho, Hawaii, and Washington).  Because of that, we see a lot of referrals from folks that don't cover as wide a range of states.  We get a lot of referrals from other loan officers that are licensed in just a state or two, and the referral stream has increased largely due to my company being a California company, and with the state, for the first time in a long time, seeing more people say 'goodbye' than 'hello'.  Except for the Hawaiians, for some reason they just always say 'Aloha!'.  I digress.  


When referring a deal, it's sometimes tough for the referring professional to let go.  Perhaps it's a past client and they're trying to maintain their relationship.  Perhaps (like many type-A professionals in the real estate industry), they know no one will do as good a job as them, so they try to "help out" as long as they can.   Whatever the reason, in my experience, if you trust someone with a referral, you should trust them fully enough to handle the referral business from start to finish.  If you can't, you shouldn't be referring.  There's no reason for "I'm referring them but I want to process it..." or "you can do the loan but I want to act as an assistant...".  No.  It messes up the process and ruins the customer experience every time.  


Just within the past few months, we've had to help reset expectations for customers from referring people "trying to help", but instead having their efforts set poor expectations and leaving their clients confused or upset. 


"I had no idea real estate taxes were so high in Texas!"
Oh, but they are!  Texas is a semi-affordable state in many regards, with home prices (at least outside of metro areas and pre-2020) priced very well.  But where Texas doesn't collect on income taxes, they get you on real estate taxes.  When referring a customer, a loan officer recently set the expectation for a payment several hundred dollars below reality, basing their real estate tax estimate off their home state, which was less than half of what the buyer experienced in Texas.  (Also a note for real estate agents:  When people are coming from out of state, be sure to explain some of the customary local things like real estate taxes that some locals often take for granted).


"We didn't realize they had that insane transfer tax!"
Yes indeed, Pennsylvania charges a customary 1% to the seller AND buyer.  Lenders in states where the seller usually picks up this cost in full are often surprised to learn that the buyer in PA is on the hook for 1% (higher in some metro areas), which can add up to quite a chunk of change in closing costs for the unexpecting out of town buyer.  No one wants to be blindsided by an extra $4-5000 due at closing.  But hey, at least they're cheaper than Delaware's transfer tax!


"Where did that extra $13,000 come from !?"
As with costs varying state to state, they often vary loan program to loan program.  We recently received a referral that was "ready to go!" from a loan officer inexperienced with the VA loan program.  What they didn't realize is that VA charges a 2.3% funding fee for the loan type the borrower was seeking, and in this case, it added up to $13,000 in additional closing costs.  SURPRISE!  Had the referral come in as it should have, with a warm introduction and no discussion of loan details, there would have been no surprise.  Instead, the applicant was extremely caught off guard.


"No one told us taxes were higher on a 2nd home!"
Again, a state specific guideline bit a referring partner in the butt with a customer.  They did their due diligence, checked out property taxes, and spent some time figuring out how to set the expectations with their customer.  But, they did all that before referring them, and they didn't cover all their bases.  They let the customer know what property taxes would be for their new South Carolina home - but they quoted them as if they were a primary residence.  South Carolina is one of several states that have different real estate tax rates depending on occupancy.  If you live there, it's cheap!  If you don't, not so much.

In doing loans in so many states, one thing my team makes a concerted effort to do is understand how business is done on a local level.  It's the reason we're trusted by real estate agents, attorneys, and financial planners all over the country.  We're not always the local lender - but we know how to do business where we do business.  That's why we're one of the highest rated lending teams in the country.  We don't like surprises, and we know others don't either, so we practice what we preach.  If we don't know how to do something, we let a pro handle it.  If you're planning on referring business, we are always open to new customers, but we do expect that you'll do the same.  In the end, it's always better for the customer!

Comments (20)

Ed Silva
Mapleridge Realty, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

When I refer a client out, I know enough to just let it go as I dot know anything about the area to where the referral i headed.  Stay within yourself with the area you know and let the professionals in that area take care of the referral.

Aug 17, 2021 08:43 AM
John Meussner

That's our practice, too.  If I refer something out, I just want to know when it closes or if there are issues that pop up.  Otherwise, I don't care to be involved.

Aug 17, 2021 10:37 AM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Good morning John - wow, who knew all of this.  It is best not to assume.

Aug 17, 2021 09:56 AM
John Meussner

Certainly is!  Things vary quite a bit from state to state, it's a lot to keep up with.

Aug 17, 2021 10:37 AM
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

This is one of the primary reasons that I will not engage with a referral I have made.  I just keep referring them back to the agent I sent them to.  I have no idea what the ins and outs in another state are.

Aug 17, 2021 10:36 AM
John Meussner

I have the same practice - if I refer it, I just want to know when it closes, or if it doesn't, why.  I don't need to be involved.

Aug 17, 2021 11:47 AM
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

Featured in the group:  BARTENDER, MAKE IT A DOUBLE.

Aug 17, 2021 10:49 AM
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Hi John- as they say, real estate is local, so when referring out of your area, let that local pro handle it!!!  

Aug 17, 2021 06:25 PM
John Meussner

Absolutely : )

Aug 19, 2021 11:39 AM
Jim Patton
Aspire Home Real Estate 209-404-0816 - Modesto, CA
Realtor - Stanislaus ,Merced, San Joaquin Counties

So very true John Meussner.  Even within a state there can be big differences, especially in a state as large as California.  Thanks for the info.

Aug 18, 2021 04:35 PM
John Meussner

Who chooses the escrow company?  Well, depends if you're in Norcal or Socal most of the time ; )  Thanks for the comment, Jim Patton , good to see another local pro here in the rain!

Aug 19, 2021 11:40 AM
Anna Banana Kruchten CRS, CRB, Phoenix Broker
HomeSmart Real Estate BR030809000 - Phoenix, AZ

Hi John it never occured to me after all these years to guide a client moving to another state with that states fees and practices - never.  I refer them to a higly competent agent, typically an AR agent or CRS and know they will take care of our clients as well as we would have. You point out well, that well meaning agents/lenders could screw up big time if they don't know another states fees and practices.  That's a big deal.

Aug 19, 2021 09:35 AM
John Meussner

Indeed!  When someone's moving to another market, often not knowing anyone, it's an extra layer of stress.  They don't need unpleasant surprises from someone that was 'just trying to help' : )

Aug 19, 2021 11:41 AM
Wendy Rulnick
Rulnick Realty, Inc. - Destin, FL
"It's Wendy... It's Sold!"

John Meussner That's my philosophy with anyone I refer to - be it  - a lender, a builder, or another Realtor.  Your description of the snafus that can occur when the referring party tries to control, knows too much, or is too helpful, illustrate the problem well. It's hands off!

Aug 19, 2021 12:07 PM
John Meussner

I'm with you 100%!  Refer, let it go, and reach out once the job is done!

Aug 19, 2021 04:18 PM
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude



Excellent advice! We all know real estate is local in many ways...not just prices...and you outlined some great examples of why a referring individual (lender or agent) should leave some important communications to the local and knowledgeable recipient of the referral. Setting expectations that are wrong doesn't do anyone any good, especially the client, and you start out on the wrong foot possibly through no fault of your own.



Aug 19, 2021 12:40 PM
John Meussner

That's exactly right, you don't want to enter the process with a customer confused and not trusting because someone else messed up!

Aug 19, 2021 04:19 PM
Mark Don McInnes, Sandpoint-Idaho
Sandpoint Realty LLC - Sandpoint, ID
North Idaho Real Estate - 208-255.6227

Too many chefs John, and they should leave the cooking to those who are familiar with the nuances of each oven.  Excellent post John.  Thank you.  Mark

Aug 19, 2021 01:19 PM
John Meussner

Thanks for the comment Mark - and yes, let the pro get the job done!

Aug 19, 2021 04:19 PM
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I think there's something to the phenomenon of the death of the expert in peoples minds just because of all the stuff on the Internet and it's kind of ridiculous

Aug 19, 2021 10:21 PM
John Meussner

Couldn't agree more, the internet has brought about a lot of positives, and plenty of negatives to go with them : )

Aug 20, 2021 03:49 PM
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Hello John: such a well-written.  So smart as I would expect.  And any client who chooses you will discover.

Aug 20, 2021 04:22 AM
John Meussner

Thanks Michael, I really appreciate that!

Aug 20, 2021 03:49 PM
Dr. Paula McDonald
Beam & Branch Realty - Granbury, TX
Granbury, TX 936-203-0279

Excellent information and yes, selecting a professional in anything to do with real estate is vital.

Aug 20, 2021 01:29 PM
John Meussner

Thanks Paula, appreciate the comment!

Aug 20, 2021 03:50 PM
Lynn B. Friedman CRS Atlanta, GA 404-939-2727
Atlanta Homes ODAT Realty - Love our Great City - Love our Clients! Buckhead - Midtown - Westside - Atlanta, GA
Concierge Service for Our Atlanta Sellers & Buyers

John Meussner 
Great set of examples for sure.
Things can vary so much between states - Borrowers with your "team" have all that knowledge awaiting them to make the loan smooooth!
All the best - Lynn


Aug 20, 2021 03:48 PM
John Meussner

Thank you Lynn : )

Aug 23, 2021 11:48 AM
Patricia Feager, MBA, CRS, GRI,MRP
Selling Homes Changing Lives

John Meussner - Here in DFW Texas county taxes differ from county to county. For example, Denton County taxes where I live in Flower Mound are cheaper than Dallas or Fort Work counties. And Coppell taxes not far from Flower Mound pays a lot more. When people are relocating to TX in the Dallas Metroplex I make sure I discuss property taxes and Federal Taxes in great details for all counties buyers are thinking about moving too. Some cities in Fort Worth may have two or three counties that a homeonwer will have to pay. Texas has no state income tax, which means your salary is only subject to federal income taxes if you live and work in Texas. Local Lenders that I refer my clients to are well versed in explaining taxes. When I start working with buyers from out of state I explain what they need to know about taxes. During the pre-approval process the Lender also goes over the estimated settlement charges. Agents and Lenders communicate during the transaction with the Title Company too. Prior to closing I go over everything again and compare what the Lender told my buyers so no one is blindsighted at closing. Buyers need to know everything they need to know depending on city and county. 


Also, agents are constantly taking continuous education from our Local Associations. Lenders, Title Companies, Attorneys, and Builders also over CE year round. Classes include taxes, appraisals, reading Settlement Statements, Understanding Surveys, MUD, PUD, PID, and so forth. Plus, agents have State Conventions, Winter Meetings in the Capitol, etc.  

Aug 20, 2021 11:26 PM
John Meussner

Patricia Feager, MBA, CRS, GRI,MRP it's great that you provide so much value, and important, too.  We're licensed and do a fair amount of business in TX, and between the real estate taxes, homestead rules, and refinance restrictions unique to the state, it's really important to communicate the things out of state folks have no clue about!

Aug 23, 2021 11:50 AM
Kat Palmiotti
406-270-3667, kat@thehousekat.com, Broker, eXp Realty - Kalispell, MT
Helping your Montana dreams take root

Yes, this is true both with real estate agents and lenders. If we make a referral, we are trusting that person to take care of the buyer or seller. So make the referral right up front and then step out of the transaction.


Enjoy your day!

Aug 21, 2021 05:12 AM
John Meussner

That's the best way to do it, Kat!

Aug 23, 2021 11:50 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

I love your post as i am seeing so many buyers with "national" or out of state loan officers that just do not know NH. We are similar as TX with no income and no sales tax, our RE taxes are higher as well. 

Aug 21, 2021 05:44 AM
John Meussner

Thanks Scott Godzyk !  My advice is always to call the lender to see what they know and don't know.  My team, for example, makes a really solid effort to understand each market we work in - so we're the "out of town" lender competing with the local teams, but I'd argue we're a better option in most cases thanks to our team's effort in understand the markets, and the technology we use that breaks down data down the zip code.  Not licensed in NH, but we do good work around much of the country :) 

Aug 23, 2021 11:52 AM
Margaret Rome Baltimore 410-530-2400
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

And then there is a state like Maryland that you may be dealing with ground rent and a big difference in taxes in Baltimore City vs Baltimore County!

Aug 21, 2021 09:57 AM
John Meussner

Oh yeah!  Maryland has some unique refinance rules as well (transfer taxes on any cash out, for example).  We love Maryland : )

Aug 23, 2021 11:53 AM
Scott Seaton Jr. Bourbonnais Kankakee IL Home Inspector
SLS Home Inspections-Bradley Bourbonnais Kankakee Manteno - Bourbonnais, IL
The Home Inspector With a Heart!

It seems so simple, but the agent trying to keep their finger in the deal are just screwing up a chance for any referrals later on, years from now. Those folks still have friends that they will talk to and tell them what a great experience they had. It will pay off in time.

Aug 22, 2021 08:29 AM
John Meussner

Exactly - staying out of the way, hard as it may be, is best for everyone.  Thanks for the comment Scott!

Aug 23, 2021 11:53 AM
Kris Collis, Associate Broker
Smart Way America Realty - East Stroudsburg, PA
Professional Results you Expect 570-801-5525

John, great information about how loans and closing costs vary state to state, some diamond examples here such as VA loans and Texas real estate taxes.

Aug 29, 2021 08:00 PM