Thread: Biggest Complaints?

Since I am a lender, and always looking to better understand my real estate agent brethren. I would like to know what are your biggest complaints with lenders? You can be as candid as needed, and I appreciate your valuable time.

My biggest complaint would be that fact that, all and everytime a closing occurs, it is a surprise for the buyer. I've never get a closing where the buyer has no surprise regarding the loan, ever. Once it's rates, or the fees, or whatever else. And I'm licensed in FL and TN. It is not a one area with the same lender stuff...

Thanks for you response.

I have some experience in FL, FL is actually the number 1 state for mortgage fraud. All fees should be listed on the GFE, but....... Sometimes these changes are due to the buyers situation changing a few days before the loan ie drop in credit ( the lender will pull credit before closing and if there is a change things get hectic). However this is no excuse and everyone should be notified before they get to the closing table. This possibility should also be explained early in the game if your client is borderline.

The loan officer I use is awesome. He goes to every closing, so if there is a question about the fees, he is there to explain it and I am not there making phone calls asking what these fees are.

That would have been my biggest complaint from my previous loan officers.

Thanks for the response,

I try and make my closings but since I operate in 3 states and often have multiple closings it makes it pretty difficult to attend every one but I am always in earshot. I am looking into cloning but at this point it seems a little expensive.

If there are surprises at the signing table, usually there's been a communication breakdown somewhere. It's not always the loan officer. I've worked with many agents who keep the loan officer at arms length when communicating with the borrower because they feel threatened by the loan officer possibly stealing their client away or something. It's not always the case but one example of many. A good loan officer will not only educate the borrower and agent on the loan process but educate them on how they work, so together with the agent they can manage expectations. #1 rule in sales sometimes is managing expectations. The only way that can be done is through communication.

A loan officer is responsible within 3 days of receiving the application to furnish a good faith estimate. We all know the loan officer doesn't have to stick to that. Afterall, it is an estimate. I always furnish a good faith estimate to the client then have the estimated closing statement from escrow sent out to the borrower and agent before documents are drawn for signing. This way the client can match up figures, interest rates, fees, etc, to the original good faith estimate and know that nothing has changed from what was originally discussed. No surprises!! It usually is a really simple conversation, we discuss the details, plan with the agent and client an appropriate signing date, and if all lines up correctly - we have documents drawn for signing and close the transaction.

But you have to communicate people. After all the years of working in this business I've found that many snags or hick-ups along the way are easily squashed sometimes with a 2-minute conversation. All you have to do is pick up the phone and communicate. Don't assume the other guys has it covered.

All the southern border states have had their fraud issues. The big one was Georgia. It prompted all kinds of questions into regulation, reform, and new legislation. If the lender is pulling credit at the end of the process looking for fico changes - the loan officer needs to clean up the pipe and get things through quicker. All of my banks pull credit during the intial conditioned loan approval process. If the loan is closed before the lock period expires, you're good to go. Subprime is a little different but approvals with credit are generally good between 45-60 days before re-running credit is even a question. Again, it all comes down to proper communication with all parties. Hopefully no-one takes any offense to my comments. I'm here to hopefully shed some light. Please let me have it if you feel I'm wrong. Feedback is always wanted.

IN defense of the mortgage broker!;

Yes there are many many bad lenders and brokers out there whether they are just dishonest, lazy or poorly trained (the latter is a HUGE problem)

However I believe that underwriters and the end lenders they work for are a major culprit here. Many many many many times underwriters make last minute changes to term and conditions, whether due to lack of training, common sense, a bad mood (or just because they have no vested interest in seeing a loan close)...and I have a feeling the end lenders often deliberately change rates and prepays in order to benefit themselves.
Additionally for all you realtors - clients circumstances often change or God forbid they have misrepresnted their real financial situation only to be discovered the day b4 closing...

So I do feel for the mortgage broker as he is the poor soul who has to relay this to the client.

Nevertheless it is the mtg brokers responsilbility to inform the client of these issues asap - BEFORE CLOSING!

Last thought - 'I think last minute suprises are often caused by the broker being too scared or ashamed to inform the client!'

For the dishonest brokers out there, one word - KARMA

from talking with Realtors around my local area that seems to be the number 1 problem. suprises at closing or that we never keep in touch and fill them in on what is going on.

I really try to keep in constant contact with them and very rarely do things change at closing. I've lost a client because "my fees were too high" because I listed EVERYTHING that they were going to pay and not just some of the fees like a lot of people will do to beat out another broker. Of course if my fees looked like they were $1,000 cheaper you'd go with me but that is when you have a "suprise" at closing and they are $1,000 higher! odd...

I try to be upfront with everything that is going to be on my GFE at closing...sometimes I win, sometimes I lose....