What to Consider When Shopping For a Loan Officer for Your Mortgage Transaction?
I have been in the Texas mortgage industry for over 9 years and I have seen the good, the bad and the ugly of Texas mortgage loan officers and Texas mortgage lending institutions. I have to say, that while most Loan Officers pretty much offer the same products, not all lenders and not all loan officers are the same. In this article I am hoping to give you an idea of what to look out for and what questions to ask when selecting both a lender and a Loan Officer for your mortgage transaction.
Questions to ask your Loan Officer:
1. What are your current underwriting times?
· If there is one thing I have learned from being in sales it’s that “Time Kills Deals”. Anytime you have a transaction whether or not you think you are in a rush, you are in a rush. Extended time frames are probably the biggest deal killers of any transaction not just mortgage transactions. If a lender has high turn times think twice about sending your mortgage to them especially with a purchase transaction. I have seen files take months to close because of underwriting turn times. Most lenders will have turn times posted for Loan Officer on both the Broker and Banker side of the business to view.
2. How long have you been in the mortgage business for?
· It’s not always a bad thing to work with a new Loan Officer; however, on complex transactions it will definitely impact you directly. In the current world of mortgage lending every loan is complicated, it is important that your loan officer knows the ins and outs of the business. Some knowledge only comes with time in the trenches and when a loan starts to go south experience makes a huge difference.
· If you can ask a friend or colleague who they used on their mortgage and if they were happy with their loan and the service provided.
3. If you are doing an atypical mortgage such as a construction loan or FHA rehab make sure to ask your Loan Officer if they have experience with that type of transaction.
· Construction lending is a whole other beast from a normal mortgage loan especially if it is an FHA 203K government rehab loan. Many times construction loans can take longer to close than a normal mortgage. This is important because you don’t want to get caught paying extension fees on a real estate contract which can be up to $150.00 per day. An experienced Loan Officer will know to communicate with your Realtor and/or sellers agent so that the contract can be amended for a longer period of time before it’s too late.
4. Last but not least, make sure your Loan Officer is in the same state as your transaction or at least familiar with state law of the subject property.
· Many states have different state laws that will impact your transaction. For example, the state of Texas has many laws designed to protect consumers when it comes to home equity loans. These laws require unique disclosures that are not required in any other state. There is nothing worse than getting to the closing table and only to find out that your loan can’t fund because a step was skipped or a disclosure was forgotten.
I have seen many Mortgage transactions fall through because of a bad Loan Officer. Above anything listed above find someone you trust and don’t trust a Loan Officer that tells you what you want to hear; trust a Loan Officer that tells you how things are, whether or not you like what he is saying.
I will leave you with one last tip. It is not a Loan Officers job to approve your mortgage, that duty goes to the mortgage underwriter. It is the Loan Officer’s duty to structure your file in a manner that it is most likely to be approved. Do not lie on your loan application be upfront with issues you think could impact your approval because the underwriter will find it regardless. If the Loan Officer knows about the issue ahead of time he can package the issue so that it may not be as much of an issue as you think.
In a mortgage transaction you must TRUST YOUR LOAN OFFICER, SO FIND A LOAN OFFICER YOU CAN TRUST.
