Avoiding Bad Mortgage Reviews By Borrowers And Realtors
This ARTICLE On Avoiding Bad Mortgage Reviews By Borrowers And Realtors Was PUBLISHED On July 19th, 2019
Tips In Avoiding Bad Mortgage Reviews:
- Avoiding Bad Mortgage Reviews is not too difficult
- These days of the world wide web and the access of technology with every statement a public consumer can make on public forums, websites, and scam sites, bad reviews or testimonials can devastate any professional
- Avoiding Bad Mortgage Review is not just limited to loan officers but any professional such as attorneys, real estate agents, doctors, dentists, insurance agents, and businesses as well
- However, mortgage loan originators have much more scrutiny than any other professionals
- Home Buyers, especially first time home buyers, is relying on mortgage loan officers in closing their home loans
- Borrowers are trusting their loan officers with the most sensitive documents and financial and credit information
- A person’s financial information is the most sacred
- Most confidential items they have and they are trusting their loan officers with tax returns, W-2s, paycheck stubs, bank statements, retirement and investment accounts, and other extremely private information
In this article, we will cover and discuss Avoiding Bad Mortgage Reviews By Borrowers And Realtors.
Earning Mortgage Borrowers Trust
Loan Officers should realize how much the borrower is trusting them and counting on them.
- In return, the mortgage loan officer should feel honored and do whatever in his or her power not to let their clients down
- Mortgage loan originators need to realize that many lives are affected by their diligence and should treat every single borrower like they would treat their family members
- This mortgage blog article is geared towards new loan originators who are entering the mortgage business and getting started on the right track when dealing with clients and avoiding bad mortgage reviews
- Avoiding bad mortgage reviews is not difficult and if you treat your borrowers better than how you want to be treated, then you will not get a single bad mortgage review
Bad mortgage reviews will be devastating to one’s career as a mortgage loan originator. Those with multiple bad mortgage reviews will not last in the mortgage business for long.
Avoiding Bad Mortgage Reviews By Communication
As a manager and in charge of loan officers, I know of every single borrower that comes in.
- I am the front line person that speaks with every mortgage loan applicant and welcome them onboard
- Not every mortgage loan application will qualify for a mortgage loan right away
- However, my business model is that if a mortgage applicant wants to realize the American Dream Of Home Ownership become a reality, our staff at Gustan Cho Associates will work with them with getting them to get qualified, no matter how long it takes
- Most lenders will tell borrowers who do not qualify that they need to come back a year later when their credit has improved
- However, everyone under my watch will work with borrowers who do not quite meet the minimum FHA credit score requirements of 580 FICO to qualify for a 3.5% down payment FHA loan
- There is a percentage of our borrowers who have credit scores in the low 500’s who we help and eventually qualify for an FHA Loan and end up closing on their home purchase
It is not if you qualify with us. It is when you qualify with us.
Always Have Open-Line Of Communication
Open communication with the borrowers is a must in avoiding bad mortgage reviews.
- If you are a loan officer who has a family and does not want to take business calls after 5 pm and do not want to take business calls over the weekend and holidays, say so to the borrower on your initial phone call
- Set proper expectations
- Every one of our loan officers at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays
- This does not mean other loan officers need to abide by my business model
- Always return phone calls and emails promptly
One way of getting bad mortgage reviews is by not returning phone calls and/or emails by your borrowers.
Avoiding Bad Mortgage Reviews Is Realizing The Pre-Approval Phase Is Most Important Stage In The Loan Process
Loan Officers need to keep in mind that the pre-approval stage is hands down the most important phase in the mortgage process:
- There are so many mortgage rules and regulations these days in the mortgage industry
- Even the most experienced mortgage loan originator will not know every case scenario
- Most last-minute mortgage loan denials are due to a sloppy pre-approvals by mortgage loan officers
- If the loan officer issues a solid pre-approval letter, then there should be no issues with the mortgage approval process and the deal should close
- I have seen many times where loan officers will just run credit
- Without thoroughly reviewing the credit report and reviewing tax returns the loan officer will issue a pre-approval letter
- The borrower goes and gets an executed real estate purchase contract
The home buyer then spends money to get a home inspection done, spends more money and get the appraisal done, and then there are issues with the mortgage loan file, which we will cover.
Avoiding Bad Mortgage Reviews By Not Issuing Sloppy Pre-Approval Letter
One example where mortgage loan application can blow up during the mortgage process is when a loan officer issues a pre-approval letter just by seeing the credit scores and not reviewing the mortgage loan borrower’s overall credit report and credit history.
- Just because the borrower meets the minimum credit score requirement does not mean that the borrower is credit qualified
- Most of our borrowers represented by Gustan Cho Associates are borrowers who did not qualify by other lenders
- Or got denied during the mortgage loan approval process by other lenders
- Let’s take a case scenario:
- Borrower with a 581 credit score gets a pre-approval letter by a loan officer
- Goes and gets an executed real estate purchase contract
- The borrower spends $350.00 on a home inspection and spends $475.00 on a home appraisal
- The mortgage loan underwriter immediately suspends the file
- This is because the borrower has a few credit disputes on non-medical collection accounts with outstanding unpaid balances of over $2,000
- The mortgage loan officer gets notified to have the disputes retracted in order for the mortgage underwriter to continue on with underwriting the mortgage loan
- The mortgage loan officer asks the borrower to retract the credit disputes and the borrower does what he is told
- When the credit disputes are retracted, the borrower credit scores drop 20 FICO points
- Now the borrower’s credit scores are 561 instead of 581 FICO
- The borrower no longer qualifies for a 3.5% down payment FHA loan
- This file is totally dead
- The mortgage loan originator should have carefully reviewed the borrower’s credit report prior to issuing the pre-approval letter and noticed the credit disputes
- The loan officer should have them retracted and saw the outcome of the credit scores after the disputes were retracted
Retracting credit disputes WILL ALWAYS RESULT IN A DROP OF THE BORROWER’S CREDIT SCORES.
Avoiding Bad Mortgage Reviews By Contacting Borrowers Due To Bad News
To top the above problem, the loan officer realizes that he made a mistake:
- The loan officer does not contact the borrower and has his loan officer assistant or the mortgage loan processor that the borrower does not qualify for a mortgage loan anymore
- This is because they do not meet the minimum credit score requirements due to the drop in credit scores by retracting their credit disputes
- On the flip side, there are many lives that have gotten affected due to this error by the loan officer
- The home buyers not only spent precious money on the home inspection and appraisal fees
- They have already given notice to their landlord that they will be moving out
- The landlord may have already rented the home the borrower was renting and now needs to find another home for the borrower and his or her family
- The borrower may have already registered their children to a new school where they were purchasing their home
- Now, how about the seller?
- The seller may have another home under contract and have spent money on a home inspection and home appraisal
- They may have already registered their children to a new school district
- You then have the buyers attorneys, sellers attorneys, buyers real estate agents, and sellers real estate agents involved where they did all the work and nobody is getting paid
All this mess just because the mortgage loan originator not being diligent prior to issuing a pre-approval. Will a bad mortgage review be warranted?
Avoiding Bad Mortgage Reviews Solutions
Mistakes do happen by mortgage loan originators. The above case scenario is a perfect case scenario that does happen in real life.
- However, with every mistake, there are solutions
- When situations like the above case scenario happen, the loan officer needs to take charge and try to solve the problem
- Not returning phone calls or not letting the borrower know is the biggest mistake he can make
- Borrowers are human beings and do understand that loan officers can make mistakes
- Be honest with the borrower, explain to them what happened, and tell them that you will be working on a solution to get this hiccup corrected
- If everyone is on the same page, the problem will get resolved and the deal can close
- The home closing may need to get extended
- However, if the loan officer can talk to the buyers’ attorneys, sellers attorneys, as well as the buyers’ realtors and sellers realtors, they should understand
- If they need to, they should even speak with the sellers
I will write about Avoiding Bad Mortgage Reviews Solutions on the next blog article which will be a continuation of this mortgage article in solving problem situations where the loan officer did not qualify the borrower correctly and go into greater detail. Stay tuned.