Help for Realtors

Based on the craziness that has occured in the mortgage industry, here are some (candid) tips for real estate agents as you move forward with your business:

ON LISTINGS:
1) Demand pre-approval letters or, at the very least, pre-qual letters that reference that credit has been pulled and reviewed. With guidelines changing frequently, it is that much more important for the buyers loan to have been reviewed by an underwriter (i.e. pre-approved) rather than the Loan Officer just having a conversation with the buyer and saying that it looks ok (i.e. prequal).

2) Watch who the letter is coming from. Who is the lender? Is it a name you know? Is it a banker or a broker? This distinction didn't use to be such a big deal, but the wholesale (broker) side of the business has been hit harder than the retail side (banker), so guidelines are often tighter for brokers. I'm not saying brokers are bad, but they are seeing more restrictions in a lot of cases and many banks have closed their wholesale lending business completely.

3) Who is the Loan Officer? Do you recognize the name? Are they local? Ask around your office or check with other agents you know to see if they are familiar with the loan officer. Experience in the industry and local knowledge goes a long, long way with all that has happened. Your paycheck is dependent on the loan officer as well as the company they work for. Take the time to be sure you are dealing with someone who is up on all of the changes going on.

WITH BUYERS:
See 1,2,3 above! Also...
1) Make sure that they are aware of the fact that the industry has changed greatly. This is not meant to dissuade them from buying, but they should know that everything is looked at much more closely than it used to be. They need to be completely honest from day one when talking to you and their lender. Quality control / quality assurance is a big deal for lenders these days, so the chance of a file being audited prior to closing to make sure that all of the t's were crossed and i's dotted is much more likely.

2) If they are in the process of packing, make sure to suggest to them that they keep all financial documents out and handy. This could mean documents from previous closings as well as paystubs, bank statements, etc. Setting this expectation up-front is huge and can make you a hero!

3) Let them know that it is not hopeless and that there are still a lot of options available. If it happens that they cannot do something right now let their lender be the one to tell them, not their next door neighbor. You hear the term "Mortgage Consultant" -- it means a lot these days.