Mortgage Tip: 10 Great Questions To Ask Your Lender

1- Will you provide me some real estate agent references?

2- Does your firm underwrite their own morgtages?

3- Is your company FHA approved?

4- Explain APR to me so I can understand it.

5- How often has rates been changing in this markt?

6- Do I need a 30 year fixed, or another type of loan?

7- Why should I use you?

8- Should I put a minimum down payment?

9- Will you explain the benefits of up front Mortgage Insurance?

10- How much home do I qualify for, even if I want to start with a lower number?

Recommended Mortgage Lender

Aaron works they way I want a loan officer to handle my clients loans.

He has direct access to his underwriter. He uses automated underwriting. He never has a loan fail once in process.

To me these are two steps to success. First to quickly find out through the automated underwriting what conditions will be needed to have the loan approved. However, the final decision is based on the underwriters decision. Sometimes circumstances, such as job history or a super high credit score allow the underwriter to make a decision to accept a loan, even with high ratios for example. I had one loan approved with a 60% debt ration. In asking why the underwriter accepted the file the answer was simple, "They have enough cash in the bank to pay off the mortgage".

A good loan officer like Aaron will seek a one on one interview with the underwriter to review any item of the loan that seems possibly an issue. That is how I worked. One of my favorite banks actually, in fun, created my own in and out box, as I was there almost daily watching over my files.

Aaron's company is a direct lender, funding their own loans. So in his case his underwriters office is across from his office. Pretty convenient.

Aaron offers these tips for your review:

Academy Mortgage is respected nationwide for their commitment to responsible lending practices. They are focused 100% on retail mortgage banking, which provides greater stability and predictability.

Buyer Tip - Ask Your Loan Officer Your Max Payment

My first loan officer job was working for a major bank. I was thoroughly trained, on salary thank goodness, and then placed inside a large real estate office. I quickly learned that agents want no failures because of the loan. They were often uncomfortable with pushing a purchase into a gray area.

I have written that I consider that searching for a home us comparable to a treasure hunt. In this light I want you to find that treasure. I found that all too often buyers started with a fixed in their minds payment number.

So here lies the paradox. When heading out for a home hunt, just how high can you go?  Will you settle for something less than you can have?

Click here for the entire article on the MediaOne blog:

How About A Little Truth Today?

I have a huge to do list today and wasn't going to post an article. I started my day with a short trip to the cleaners and I saw a bill board that upped my temperature a bit. Not this billboard, a loan officer billboard. It was big and bold, in a setting like this one.

The message on this particular billboard was implying that when you get a loan from him you don't pay for appraisals, credit reports, lender fees, etc.

That alone might not have set me off except for the fact that I had the radio on. On came an advertisement from a national mortgage company touting that they had the number one customer satisfaction rating from another national company, a rating and research company.

So my temperature rose again, and here you get this fun article to read.

Read the full article on the MediaOne Real Estate blog: CLick here

The Plumbers And The Loan Officer Story

My advocacy of Bruce Pluming is explained in this story. They are the good guys. They don't have a website. Their phone number is 801-466-4426. I will update this article with loan officers and others I decide to advocate. Let me know how it goes with those you select as advocacy must be continually earned.

My experience has taught me that service providers such as loan officers or plumbers place a higher value on a referral that has been provided by someone who brings them a steady flow of repeat business than a random referral, a walk in, or a response to an advertisement.

I illustrate with two examples: a loan officer and a plumber. The principle applies to a lot more than these two fields. Customers or clients deserve the best service and competitive or fair pricing. When they are referred to a provider they should expect this, as well they should expect delivery on time and receive what was promised as it was promised.

Let’s assume a loan officer earns $1500 on a closed loan. Let us also assume this loan officer has a real estate agent that provides him or her access to clients every month on a steady basis, perhaps 10 loans a year come from those referrals. Doing a good job for a client in this business can be time consuming; there is much to do to assure things go well and that the loan closes on time.

The loan officer also has to do a lot of communication with the various parties involved. The $15,000 a year earned in this example is well earned. Next, suppose that you hear about this loan officer from a radio advertisement or from a neighbor. Of course your loan is important, after all $1500 will buy a lot of bread. But let’s say things get stressful. Rates start rising and people start panicking for example. The loan officer is doing his or her best, but who has the priority if things get real difficult? You, who were referred by a neighbor or an advertisement, or the real estate agents client who is the source of many loans. In working with and employing hundreds of loan officers I understand that no matter how serious the effort, how genuine the intention, how stalwart that loan officer may be, the repeat business has priority.

This illustrates what really can happen. It can happen in any field. 

I occasionally have people from out of my market ask me to find them a good lender. I always make sure I contact a high producing real estate agent, ask them for a lender referral, and ask them to let the loan officer know I would be connecting them with my contact. This type of connection was to cement to the lender that this real estate agent would be aware of how well the transaction went. This may take a little extra time on my part, but I truly believe that the best experience possible is in this process.

The plumber example is first hand and recent. I should have practiced what I am preaching. We had water coming out from underneath our washing machine. We asked a neighbor for a referral. (We live in a condominium high rise) The plumber turned out to be actually two plumbers. I had no idea why two plumbers had to come. 

The fix was a quick one; they used a rooter type tool so I asked them to see if they could use the tool to speed up the draining in a bathtub. This took another few minutes, not many. They were here at our home for less than an hour. How much should the bill be? We live in downtown Salt Lake City, not in the middle of nowhere. The bill was a staggering $750.00. It gets worse. 

The job they did on the bathtub drain was a bad job. The next morning we had a knock on our door, the building maintenance supervisor was the bearer of bad news. Our draining tub was filling the hallway with water. Yes, the rooter tool ruined something in the drain. Who were we? We were just one client out of the blue. They had only our small world of business to lose. So did they honor their mess? No, nor did they think their bill excessive.We had to hire another plumber. This time we found one the condo association and management company could refer us to, Bruce Plumbing. I made sure I got their name from the onsite manager. I spoke with the maintenance supervisor. When we called  I used them as the referral. Messing with us now could cost them future business. This next plumbing experience was a good one. They fixed the damage. We had them fix a sink that had a little leak too. This visit was longer than the first one. The bill was $175.00. The sink still leaked, actually leaked more. We called the next day and instantly they were out to fix the leak, at no additional cost. We were happy.

The lesson, always be referred to someone in a way where they have future business at risk. 

Put yourself in a position as a sales person or vendor to be trusted like this. Put yourself in a system that promotes this. If you have a website, invite your favorite vendors on there. Recommend them. It is the foundation of a happy customer. It’s a part of implementing the full definition of guru.If I place you on my website as someone I ADVOCATE I expect you to deliver a fair price, on time, delivering the product or service as promised. You should expect that of me too. We would be expecting each other to be a guru to our referrals and we should value being continually listed as ADVOCATES of each other.

Mortgage Tip: Beware Of The Advertisers

In another article I propose you always use a mortgage person referred by a REALTOR. I say that in this article where I discuss advocates, click here, Look for the message on having future business at risk.

I will give you two examples of potential issues, there are more.

The home office of mine and Kathleen's mortgage company was in a large real estate office (we had several branches throughout the greater Seattle area). There were 300 agents licensed in this office and most of them didn't use our company. The deal was, I could office there but not solicit their business. If they came to us voluntarily, that was fine. As my office was a convenient down the hall location from the conference rooms location I was sometimes called to help agents who had problems. It was usually a performance issue. It was often an online company issue.

The pressure is on in a purchase transaction. Closing dates must be met. Commitments for interest rates must be as promised.

I was often called in to solve a problem at the last minute. Of course if it were a closing date issue I had to do what I could to help the other lender perform. If the pressure was on changing lenders was not a feasible solution. A local lender was easy to work with, a national lender not so easy. Daily I hear advertisements from a company I was sometimes called into resolve issues with. They claim they are number one in service as studied by another national company. I tell you now that advertisements almost causes me to get ill. To get them to honor a rate they had promised, in writing, after the final documents didn't match, my only weapon was to threaten turning them over to the Attorney General. Now, the new laws have solved this particular problem but there are other issues, such as closing on time. Even so, why would you trust your loan to an advertiser or an online company with little or no future business at risk for non performance. It makes no sense to me.

The second example is similar. My first employer as a loan officer was with a national bank. Their training was great but I hated working for them. My biggest gripe was that we were all required to answer advertising calls on Mondays. They always had a big ad in Sundays paper and the calls were fast and furious on Monday. Here is the distasteful part. The ad had to be placed on Wednesday prior to the Sunday delivery. Give me a break, rates change daily and sometimes hourly. How can a rate quoted on Wednesday be valid five days later. I am pleased to say I was on salary. I am more pleased to say I was doing enough business that I was recruited away to a much more honorable situation.

Ask an agent to give you a referral to a lender they trust. It's OK to even ask for more than one reference. I will be selecting up to five you can find on this site. Stay tuned as I work for a mutually beneficial commitment. If you need one before these lenders are up, call me and I will help you immediately.