Are You Working With a Part-Time Lender?

I can’t talk right now, I’m at my day job…

…came the whisper from the other end of the phone.

Escrows are falling apart at an alarming rate these days. Most of the fallout, according to Realtors my agents is caused by incompetent lenders.

On a recent visit to Keller Williams, Chris DeMattei and his team shared a story with me. They had an escrow that was late in closing. Loan docs had not arrived in time, and they couldn’t get any information or a return call from the lender. Unsure how bad the problem was and totally in the dark, they were anxious and frustrated.

Like so often these days, the buyer had come with his own lender. This person was unknown to the team and felt no accountability to the relationship. When things got tough, she stopped returning calls. Elaina, the team’s buyer’s agent, had finally caught up to her late one morning… only to be told, I can’t talk right now, I’m at my day job.

Advice to Agents

It’s common today to encounter buyers that claim to be pre-qualified. Unless you personally know the lender involved, this is absolutely worthless. I understand that you don�t want to start a new relationship off with an argument. But when you allow people onto the team who are incompetent or lack your ability or commitment to client service, you put the transaction and the client relationship at risk.

Is that really how you want to build your business?

If not, here’s one suggestion for creating a win-win with your new prospect. Tell them, “You’re smart to get pre-qualified, and you should use the best lender you can. I am going to have my lender call and talk to you briefly. This is someone I have known and worked with a long time and in whom I trust. This will allow me to secure a pre-qualification letter from a local lender that everyone around here knows and respects.”

Bob Prevelige makes some more good points in his recent post on Active Rain.

Advice to Buyers

Lending isn’t rocket science. It is, however, a business of a thousand tiny details. Any one of those can trip you up, cause a decline, delay your close, or cost you money. I’ve been originating loans for 17 years at a rate of 300�500 loans per year, and I get a lot of practice. Still, it’s a huge challenge to keep up with new loan programs and changes to the old ones. I couldn’t do it if this wasn’t my primary and exclusive job.

Resist the temptation to let your nephew with 6 months experience handle your loan. You wouldn’t entrust him with your lump sum pension distribution would you? This important financial stuff. Like the poor woman who recently came into my office for help after letting her daughter�s boyfriend handle her refinance, you may regret it. Read that post: Mortgage Horror Story of the Week: Ripped off by Daughter�s Boyfriend.

When it comes to important financial matters, someone once said, Either be an expert or use one; otherwise there’s an amateur running the show.

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