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Tag: Lending (page 1 of 1)

June 6, 2009

Why Real Estate Agents Should Stop Playing Loan Officer

by

Las Vegas Mortgage Blogger

Author website

I wasted a few hours this week cleaning up the messes that real estate agents created for their first time home-buyers.

End result – loan officer still looks like a jerk, but now the borrowers are really confused about who to trust.

I’m going to combine about five separate scenarios and conversations that I had this week into one rant just to get my point across.

First of all, the mortgage industry is changing very rapidly.

True  mortgage professionals are paying attention to things like:  HVCC, concerns of HR1728, Mortgage Insurance companies changing their guidelines, Fannie’s new condo rules, FHA fico score requirements, Loan Level Price Adjustments, new FHA appraisal guidelines, adjusting interest rates in an unstable market, and a constant stream of mortgage Twitter chatter that only adds to the noise.

For those of us primarily working with FHA First-Time Home Buyers, we’re also keeping tabs on the $8000 Tax Credit being used as a down payment, as well as how long the Fed plans on purchasing Mortgage Backed Securities to keep rates lower.

Just as real estate agents are learning about short sales, bank owned properties, and transparency, mortgage originators have a full-time job keeping up with industry news so that we can lead our clients down the right path.

I don’t think that I need to throw another 9 links in this post to demonstrate that there are a lot of things real estate agents and loan officers need to understand before we can express with confidence to our clients that we truly have a handle on their unique scenario.

Imagine what the effect would be on a first-time home buyer if puked all of this overwhelming information on a them in the first 10 minutes of the initial phone call?

I had to do this all week just so that the agents and borrowers would understand why I wasn’t able to issue a quick pre-approval letter and GFE simply based on a 15 min phone call and credit score.

We’re in a tough market, and I totally empathize with the hard working agents who are competing for new business by giving the highest levels of service possible.

However, Read more

October 9, 2008

Should Walmart Sell Real Estate?

by

Realtor, Rabble-Rouser

Author website

It appears that Coldwell Banker may be following the Walmart approach to real estate pricing – recommending that sellers cut their home prices 10% across the board – not locally, but nationwide.  I can’t help but find the similarity to the McCain approach to cut government spending – simply freeze spending across the board.

Shouldn’t price cutting be done with a scalpel-ly machete?   Pardon the pun, but in many cases 10% doesn’t cut it.

I had a very difficult discussion today with the developer whom I represent regarding a new and very aggressive pricing strategy for their condominium project slated to deliver just about when the snow flies.

New lending guidelines regarding new construction could potentially crush them – even with units under contract, no potential buyer can close without at least 51% of the units being under contract – we’re not even close.  While Chicago may be a stable market per Fannie Mae guidelines, in light of the recent Wall Street meltdowns, I suspect the we may be in a declining market faster than you can say bailout.

If they don’t get aggressive quickly, we as taxpayers may just be owning 8 stunning, uniquely contemporary condos.  My recommendation was a bit more dramatic – depending upon the units, as much as a 15% price cut.  They didn’t take it well.  They “hoped” to get the prices we had established – they forgot the second half of the word  – “less”.  The good new is – we have time to thoughtfully approach the pricing strategy.

If we aren’t having the tough conversation with our sellers regarding pricing – okay, I’m going to go there – aren’t we like Congress, complicit in extending this housing market nightmare by not doing what we’re paid to do – provide knowledge, expertise and guidance?  While I can’t completely fault the strategy that Coldwell Banker wants to deploy, where did 10% come from exactly?

As far as I’m concerned regarding my own client’s situation, the comps matter significantly less than current lending guidelines do.  If mortgage money for conforming loans is still relatively plentiful to the well-qualified buyer, my client’s units need Read more

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