Why Can't The Mortgage Process Be Transparent?

By
Real Estate Agent with Rich Cotton The Waterfront Specialist EXiT Preferred Realty

I see it time and again. The day of closing or 24 hours prior to there is a glitch. Why wait until a day or less before closing to do your work??? People with truck loads of furniture, children in tow and even the family pet with no where to go. It is disgraceful how the system treats people as numbers or objects, not human beings with needs and feelings. "I'm sorry for the delay" is not good enough. If we as Realtors have to take fair housing and ethics training every several years how about the mortgage professionals having a training on empathy and communication. Does anyone else suffer through this process?

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  1. Donald Bradbury 06/02/2009 09:21 PM
Topic:
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Rainer
200,972
Jesse Skolkin
Independent New York State Certified Real Estate Appraiser - Fresh Meadows, NY

I think that the problem in a lot of cases is that we are all trying to hit a moving target.  The industry is changing, and not in a straight line or in a logical way.

For example, I had a lender tell me four weeks after an appraisal was SUBMITTED (not ordered) that they needed photos of all four sides of the subject property for an FHA transaction.  I had to explain that FHA guidelines simply require that the front and rear photos be taken from opposite angles to show all four sides of the building - which they did.  In the meantime, at least a day or two was lost in the loan process. Multiply this one incident by a half dozen or dozen other issues which arise, and you can see how the process is breaking down.

Jun 02, 2009 03:40 PM #59
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Jerry,

I agree. It is very hard to the the best we know we can be. We just need to prepare our clients for the storm ahead.

Bekah,

Dating!!! You are married!!! Only kidding. I know the feeling. If only people could stay connected through the process.

Crystal,

I wish we could work together.

Darin,

Well said! I like the way you think. No, I know it is not only the LO or the Realtor or the client that shoulders all the blame. We are all in this together,....sink or swim. What is needed is the understanding between all parties as to what the process is, who is responsible for what and what may throw a monkey wrench in the process. With that said I do not dislike LO...I always try for a respectful yet cordial relationship...............until the communication stops. There is no need for the dialouge to break down.

I love AR because we CAN have this discussion and keep it professional. Thanks again for your time and comments.

Jun 02, 2009 03:44 PM #60
Rainer
96,247
Nicholas Goraczkowski
Aurora, CO
Your Mortgage Resource - (720) 83-RATES

As a Mortgage Professional, I do understand the frustration that comes with lack of communication.

What's unfortunate is that the majority of loan officers spent all of their time focusing on refinances. Now that the refi boom is gone, they want to do purchases. Problem is, they think they work the same way.

"As long as i give a good excuse, they will understand."

"Sorry, not me - it's my underwriter.

There are a million excuses. Folks need to step up and take responsibility!

Why is it that whenever I work a new purchase, the seller's agent is always so surprised when I send them update emails or give them a phone call as well as the buyer's aget? ANYTHING to do with the loan is our responsibilty and NO ONE gets paid until we close this loan. Let's work together towards a common goal.

I don't understand why that is such a hard idea for most "loan officers" to comprehend.

I think that it is a sad thing that so many mortgage brokers have ruined the perception of a great industry.

Take care of people and they will take care of you. Not a hard lesson to learn.

Jun 02, 2009 03:46 PM #61
Rainer
26,413
Joyce Windschitl Hercules
Prime Mortgage - Chanhassen, MN
MN, FL, WI & CO Mortgage Consultant

Jesse Skolkin - I was the first to run into that issue in the last month.  Argued it.  Got it done out of frustration.  A couple days later another top producer had the same U/W findings.  He called and vehemently argued it.  Guess what, he got it done too.  There is no reason and it meets the FHA guidelines so why does the U/W call for it?  It is a moving target.

Jun 02, 2009 03:47 PM #62
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Mike,

As Bill so astutely stated the title is really not what the post is about. It is about honesty, integrity and communication. Sorry if I misled anyone.

Sylvie,

I understand your process and agree with it. That is what I teach my agents to do and they do it. My problem again those last minute hurdles that create the stress and anxiety>. That is when the lines of communication must remain open and used as frequently as necessary to keep all the players informed.

 Midori,

Amen to that!

Jason,

You really seem to be on top of it. Thanks for the comment.

 

Jun 02, 2009 03:52 PM #63
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Nicholas,

100% on board with you!

Joyce,

Maybe we can't stop the target from moving but we should all know where it is going!

Jun 02, 2009 04:03 PM #64
Rainmaker
172,509
Svetlana Stolyarova
Local-n-Global Realty, Cleveland and International Real Estate Solution - Mayfield Heights, OH
Local-n-Global Realty, Broker 216-548-4663

Rich - I am a control freak, so in most cases I don't have these problems. I do understand that underwriting requirements are constantly changing.

What I do not understand is why loan processors do not give the borrowers a clear guidance on typical requirements? Why should I remind my clients AND loan officers to contact the insurance agent at least one week prior to closing? Why don't they create a clear and simple algorythm for typical situations? All deviations can be predictable, too. It's not a rocket science!

I am very glad that you wrote about this. It's all about human beings (including Real Estate agents BTW:)! Why don't all professional  parties of Real Estate transaction be more respectable?

Jun 02, 2009 05:36 PM #65
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Svetlana,

Your question is one of great importance, Anyone care to answer?

Jun 02, 2009 07:28 PM #66
Rainmaker
152,100
Kathy Knight
Intracoastal Realty Corp - Wilmington, NC
BROKER, ABR, CRS, GRI, SFR, Wilmington NC Homes and Beach Homes

I totally agree with you Rich. We are subject to all kinds of ethics rules, state regulations, etc and one little glitch by the mortgage people and there can be no closing. It is  very upsetting that we can be held to task for missing a closing but not mortgage people. I even had one guy that didn't have the guts( i would rather another word) to call me and instead called my broker in charge to tell her why the mortgage didn't fund and we couldn't close. He went off for the weekend. What a jerk...Will never use that idiot again...

Jun 02, 2009 07:55 PM #67
Rainmaker
126,236
Aaron Poling
Long & Foster - Martinsburg, WV
Working to get YOU the BEST Deal!

Simple answer. They dont have to face those people, we do. If they had to face the people that are effected by what they are doing, things would be different.

Jun 02, 2009 10:01 PM #68
Rainmaker
813,176
Gail Robinson
William Raveis Real Estate - Southport, CT
CRS, GRI, e-PRO Fairfield County, CT

I've only worked with a few mortgage brokers who communicated openly and frequently with me throughout the process.  I want to know the details, starting with the pre-approval - did they see the clients financial statement and run them thru DU for this transaction right on through knowing what the clear to close conditions are.  Even so the process is not as transparent as it should be and even the mortgage brokers sometimes have difficulty knowing what is going on when it gets to underwriting.  FHA mortgages have the highest failure rate in my experience and failure to close on time.  It is heartbreaking to see the impact on the buyers and sellers. 

Jun 02, 2009 11:18 PM #69
Rainer
83,756
Andrew Haslett
Van Warren Home Inspections, NAHI CRI - Fort Knox, KY
Heartland of Kentuckynulls, Best Home Inspector

Rich, this topic touches a nerve with me.

Having purchased more than one piece of property, one part that I dislike greatly is the [IMHO]industry-wide cavalier attitude that I sense with regard to getting everything in line for the closing. Everyone seems to be running around at the last minute.

Compounding that is the expectation that I have everything completed yesterday.

 

Hurry up an wait!

BTW, it hasn't stopped me from investing.

Jun 02, 2009 11:53 PM #70
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Kathy,

There does seem to be a very strong air of detachment among soem LO. It infuriates me to no end.

Aaron,

For the most part this is true. I did have the LO involved in yesterdays fiasco in the office face to face with the buyers....whole different attitude!

Gail,

Consider yourself lucky that you have a few that say what they do and do what they say. As I said earlier the blame does not solely rest on the LO shoulders but the responsibility for communication does.

Andrew,

Thanks for helping us out buying some property. I know, hurry up and wait. Almost like back in the Service again!

Jun 03, 2009 05:46 AM #71
Rainer
170,043
Katiejo Franks
Real Estate and Beyond, LLC - Scottsdale, AZ

Wow-this was an excellent post. I love reading your posts. Keep up the great job on blogging.

Jun 03, 2009 06:40 AM #72
Rainer
65,584
Steve Hubbell
EXiT Realty Chesapeake Bay - Chesapeake City, MD
Realtor, Waterfront Specialist

Wow you really hit a nerve with this post! My view on this is that in today's environment of volume driven, expense cutting, computerization, the average big bank has forgotten who they work for and what individual service means. It's not necessarily the local Mortgage Officer, but the centralized processing that these companies do now , to the point that the Mtg Officer has no relationship with the individual underwriters! Until there is a breakup of these huge banks/mortgage companies to a more local driven business model, this lack of customer service will continue. Add to this the present Refi load on these businesses is it any wonder we are taking a back seat! Unfortunately for us, the small local Mtg Broker has also become a victim of the economy and has little consistent access to mortgage outlets. These local run businesses are dependent on Local Customer Service, not multi Billion  $ Advertising Campaigns! I guess its like anything else in this business, we have to do a better job of educating our buyers and sellers of the potential pitfalls in this aspect of the transaction, and keep hoping for change....

Jun 03, 2009 10:49 AM #73
Rainmaker
108,748
Linda Tremblay
Long & Foster Real Estate, Inc, PA License #AB065488 - Doylestown, PA
Associate Broker - Bucks County, PA Real Estate Services

I totally agree with you.  How come they can have a mortgage application 45-60 days before closing, but they always need something the last day. 

Jun 05, 2009 11:40 AM #74
Ambassador
721,584
Mike Jones
SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) - Tucson, AZ
Mike Jones NMLS 223495

Rich,

I've read half of the comments in detail, and I'd like to compliment you on your responses.  One can learn a lot about someone else by reading not only what they write, but by seeing how they respond to criticism.  If I were looking for a home in your neck of the woods, I'd choose you as my REALTOR because of what I see in you through this post and commentary. 

Mike in Tucson

Jun 08, 2009 08:58 AM #75
Rainmaker
182,381
Rich Cotton
Rich Cotton The Waterfront Specialist EXiT Preferred Realty - Chesapeake City, MD
Waterfront Specialist Cecil and Kent Counties MD

Hey Mike,

Thanks for that encouragement. Active Rain is something that NO Realtor should be without. I am beiginning to feel more at homw here and will start to post more. Again, thanks for the comment.

Jun 08, 2009 09:15 AM #76
Ambassador
2,424,397
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

I am of the opinion that when a loan approval is late, the buyer's loan officer should take them home.  Or, pay for lodging and storage for their belongings if necessary. 

I'm happy to bring folks home.  That's my bottom line, but the loan offer should.

Jun 13, 2009 08:30 AM #77
Rainmaker
312,553
Lori Churchill Cofer
Beasley Realty - Pullman, WA
Realtor - 509-330-0086 - Pullman, WA

Rich,

Unfortunately it seems all too prevalent...and it upsets me that it does...I like Lenn's suggestion...maybe if it was on the lender's dime this wouldn't happen so often...

Nov 23, 2009 10:13 AM #78
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Rich Cotton

Waterfront Specialist Cecil and Kent Counties MD
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