Selling Homes – Isn’t That Enough?

By
Real Estate Broker/Owner with Island Style Realty Inc. RB-19250

                                                      House For Sale 

Yesterday I attended an awards luncheon.  On of the things that got my attention was the venders who were at the event.  There were a couple of lenders present, who were owned by other real estate companies.  First of all I would never use or recommend their services, period.

I am real glad my company does not own a mortgage company, an escrow company or any other service company.  The conflict of interest is too tremendous.  If I ever leave the company I am with I would not consider an office that also owns and promotes their own lender or escrow company.  I can not imagine any added benefit for the real estate agents, just a lot of additional liability.

I know many will disagree with me on this subject.  That is OK there are companies just right for them.  For me selling homes is enough.

Posted by

 

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Randy L. Prothero, REALTOR®

Principal Broker, ABR, AHWD, CRS, e-PRO, GRI, MRP, SFR

Island Style Realty Inc.

Team Leader - "The Prothero Group"

Randy Prothero is well established as an expert in working with military / VA clients and first time home buyers.  His home seller's (listing) campaign is one of the most aggressive marketing programs in the area.

Based out of Mililani, Hawaii. Randy services the island of Oahu (Honolulu County) Performs mediations and ombudsman services for the Board of Realtors.  To improve overall professionalism in his area Randy also offers classes for real estate agents. 

www.HawaiiRandy.comOahu (Honolulu County) Property Search  Hawaii Military Relocations

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Location:
Hawaii
Groups:
Realtors®
Tags:
mortgage
real estate sales

Comments 57 New Comment

Show All Comments
Rainmaker
66,436
Derek Bauer's, www.DoorToDreams.com Door to Dreams Home Selling Team
Real Estate One & Max Broock
Randy - Of course the best service should always be provided ... that goes without saying, I think.
February 24, 2008 01:50 PM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.
Derek - I think it needs to be said.  I run into many companies and agents who work on price and not service.
February 24, 2008 02:09 PM
Rainer
143,777
Gary J. Rocks
Werner Realty

Randy

I agree with you, Brokerages put a lot of strain on their agents by making it mandatory for you to introduce your clients to their Mortgage reps. I once worked for a company that if the mortgage rep didn't sign off on your file that they interviewed your client, you didn't get paid!

February 24, 2008 06:28 PM
Rainmaker
66,436
Derek Bauer's, www.DoorToDreams.com Door to Dreams Home Selling Team
Real Estate One & Max Broock
I think many Brokers forget ... IT VIOLATES RESPA TO MAKE AN AGENT USE A CERTAIN VENDOR.  Gary, and SO many others that commented here today - you may want to remind your Broker they are/were breaking the law.  Even though we are encouraged to use our in-house vendors, we are not stiff-armed to do so, and we are certainly not forced to do so.
February 24, 2008 07:06 PM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.

Gary - That would be an easy decision for me.  See ya!

Derek - I like not having them in the first place.

February 25, 2008 01:14 AM
Rainmaker
68,683
John Cobb, REALTOR - Warner Robins Georgia Homes for Sale
Subdivisions, Foreclosures, Real Estate, New Homes
Fickling & Company
I work at Coldwell Banker SSK Realtors in Warner Robins GA and we have an in-house lender, but it is not mandatory that we use them or even introduce them - which would be called steering. I like having an in-house lender that is available if want to use them. I have used our in-house lender a few times and they were great! It is nice to have someone available that can work up a net sheet to help the customer compare rates and payment information to help the customer find the best deal for them. As long as the lender is local, reliable, and fast it doesn't matter to me which lender they use. Having an in-house lender can be a positive thing to have in your office....
February 25, 2008 02:19 PM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.
John - The loan officers I work with the most are fast and real good at what they do.  I have found it a plus not having the in-house lender.  I have made a business decision that I would not work with an in-house lender or hang my license where they have have and push one.  Those who use them need to weigh the liabilities as I have and make their own business decision.
February 25, 2008 02:38 PM
Rainer
67,568
Sandra Carlisle
Residential Sales & Property Management
First Team Estates
We have in-house escrow, title & a lender. It's encouraged to use them but you aren't given grief if you don't. The lender we have now I found when he was with an outside company and I thought he would be an asset so I referred him and he chose to make a move. I also have other "outside" lenders that I can recommend but my buyers have always chosen him after an interview. We also have a very ethical and hardworking escrow team and title company that were told they need to earn our business. And they have but I think this team is a rare find. Most deals where I've had to use other companies in house people have been some of the most difficult deals and worst title, escrow and lending experiences which is why I love my team. We aren't given any type of incentive, other than great service, but again, I think they are an exception to the rule.
February 25, 2008 07:38 PM
Ambassador
1,229,022
Erica Ramus
MRE, Schuylkill County PA Real Estate
Erica Ramus - Ramus Realty Group - Pottsville, PA
Randy, I agree with you 100%. We have a major franchise here that pushes ALL their deals with their inhouse title and mortgage lender. Once they get a buyer they rarely go outside the office for another lender. This is a conflict of interest, I think! They don't give multiple names for people to shop around. They just push all the buyers to their own lender and title company. The consumers don't realize they're being steered to a single company till they're well into the process. All the buyer wants is THE HOUSE. Just get me the house. They don't think about the mortgage or title till they're in the middle of it, and by then the company has snagged their business. 
February 25, 2008 08:12 PM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.

Sandra - I the past I never recommended a counter offer for an escrow company.  After the worst one ever from an in-house escrow company for a large real estate firm, I have had to rethink that.  An escrow is supposed to be a neutral third party.  They can't be neutral if they are owned by the real estate company.

Erica- I have two potential and one current client who all got less than desirable mortgages when they bought new construction and was financed by the developers lender.  No one looked out for their interests when they purchased directly with the developer and their in-house services.  The ARMS are kicking in and the hard prepays are trapping them.  I can say that not one of my buyers is in the same situation. 

February 26, 2008 02:30 AM
Rainmaker
446,004
Vickie McCartney
Broker, Real Estate Agent Owensboro KY
Maverick Realty
I think that we as Realtors should always give at least 3 options for any loan officer,inspector,appraiser,insurance company ,etc. so that the client picks who they are comfortable to work with  You know that the mortgae companys and title ecompanies don't tend to stick their necks out to refer to just ONE particular realtor either.  It's called CYA. 
February 26, 2008 06:59 PM
Rainer
15,208
Joe Davis
Indiana Commercial Realty
List to Last!  Isn't that the saying?  You got a good method. Go with it
February 26, 2008 11:31 PM
Anonymous #50
Anonymous
Anonymous
I agree with you.  I have never recommended a lender from a mtg company that was owned or associated with my real estate office.  I believe the buyer needs more choices in lending.
February 26, 2008 11:49 PM
Rainer
27,385
Ton A. Ali
Realtor - Broker ABR, Eco Broker Certified
CORNERSTONE GROUP REALTORS
I understand where you're coming from, but our company does own a lender that is a division of Wells Fargo.  They have a penetration rate of about 30-35% and are in the top 5 in the country for customer service.  It is great to have a lender right there when you have a client in the office that sees the light.  Also, they do some interesting things to entice us.  If we use them, our contact information is actually printed on the customers statement every month.  they see you and your information 12 times a year with you having to do anything.  We also disclose our relationship in a full page form because there are several other companies that we own. We don't own an appraiser.  I see that as a huge problems as far as liability.
February 27, 2008 06:52 AM
Rainer
8,345
Robert Arnold
Lake Livingston Real Estate
Brooks Prime Properties

I could not agree with you more and from what I have read so does everyone else.

February 28, 2008 02:29 AM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.

Vickie - I think the number of people you give the client is not as important as the quality.  If you give three names and the one they use does a bad job you have more liability than if you gave them the name of one great loan officer, etc., who took good care of them.

Joe - Thank you

Ton - That is a business decision we all have to make.  I think my decision on that subject is real clear.

February 28, 2008 11:16 AM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.
Robert - Not everyone agrees with us, but definitely the majority.  It is a dangerous road that some choose to travel.
February 28, 2008 11:18 AM
Rainmaker
72,292
Paul Howard
NJHomeBuyer.com Realty, 856-488-8444
Paul Howard, Broker, NJHomeBuyer.com Realty 856-488-8444

 

I believe the conflict exists with these companies. How could it not? To some buyers it makes the process SEEM easier but  in reality that is an illusion.

February 28, 2008 03:36 PM
Rainmaker
620,106
Randy Prothero
Hawaii REALTOR, (808) 384-5645
Island Style Realty Inc.
Paul - I don't see how it makes the process any easier.  I agree at best it may be an illusion.
February 28, 2008 03:51 PM
Rainer
5,851
Max Kim
MetroPointe Group LLC.

Hi Randy,

 

I dont' know if you remember me, but I met you at the NAR convention last year at the Active Rain party!

I hope your business is doing well! I just finally started doing blogs, so please let me know what you think about my blogs when you have time! 

February 28, 2008 06:55 PM
Show All Comments
Rainmaker
620,106

Randy Prothero

Hawaii REALTOR, (808) 384-5645
Ask me for a free valuation of your Oahu Home.
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