Chris Copley, a regional sales manager at TD Bank with more than 10 years of experience in regional management in the northeast U.S., has instructed numerous mortgage origination seminars to loan officers.
Tap Local Banks for Better Mortgage Options
Partnering with mortgage loan officers in your area can help you steer buyers toward a greater variety of special loan offers at their local financial institutions.
July 16, 2015
If you’ve gotten pitches or meeting requests from mortgage loan officers, now’s not the time to shy away. With more home buyers using their primary financial institutions to obtain a mortgage — 42 percent, according to TD Bank’s 2015 Mortgage Service Index — establishing a relationship with local banks could be an invaluable way to move your clients’ real estate transactions forward quickly and efficiently.
The tightened regulatory environment has made banks more competitive and nimble, prompting them to offer better mortgage products, better service, and attractive discounted rates for loyal customers. If you’ve got contacts at the local institutions where your clients do their banking, you can help them access mortgage options with a high level of service at prices cheaper than they’d find at many big banks. Here are seven reasons why building a relationship with local MLOs helps you better assist your clients.
Vetting your MLO: How to Evaluate the Best
Mortgage loan officers have plenty to offer clients, particularly today, as new mortgage products are developed and relationship banking is highly valued. Make sure you’re partnering with one who will work the best with your clients by asking these questions:
- How long does it take to close a loan? If an MLO cannot guarantee a closing within the standard 30 to 35 days, move on to one who can.
- What can you do for my clients? As a real estate practitioner, you should be able to provide an accurate portrait of the types of buyers you serve and their typical situations. Note how the MLO explains products and variables that might apply to your buyers’ scenarios. Consider the advantages of the products offered and the MLO’s effectiveness in explaining them to you.
- Are you accessible? MLOs should be able to return calls promptly, address concerns without delay, and provide answers and follow-up to you and your clients.
- Explain the typical origination and underwriting process and how you keep clients informed. Proactive MLOs are the best MLOs. They communicate. They understand clients’ needs, keep on top of details, and guard against surprises and snafus. Make sure they can explain the process to you before giving them a chance with your clients.
- What do you need from me to do a good job for my buyers? Listen carefully. You want an MLO who values respect, understanding, and good information, and who will work with you and your buyers as a partner.
- Variety. You may find that regional banks are now offering an array of products well-suited for a diverse group of buyers. By working with local loan officers to become familiar with what they offer, you can be ready to assist clients who have special mortgage needs. For example, TD’s new Right Step program is ideal for first-time buyers, offering a low 3 percent down payment and eliminating the need for private mortgage insurance. In regions where new construction is surging, you may find banks offering construction loans with competitive rates. In areas where buyers have a short horizon or special economic considerations, banks may offer adjustable rate mortgages or adjustable hybrids.
- Guidance. You expect the people you partner with to help guide your clients through the buying process, and the best MLOs will guide buyers through the financing process and identify products that make sense for their individual financial situations. Does the buyer qualify for an affordability program? Are ARM options appropriate, or is a 15-year or 30-year conventional mortgage best? Will a 3/1, 7/1, or a 10/1 hybrid loan fit the buyer’s overall plans? MLOs understand the mechanics of loans and can calculate the options. A capable MLO will ask questions to determine a buyer’s specific needs and work to meet them. And they serve as a strong added value to your customer experience.
- Competitive rates. Banks have the capacity to offer diverse loan products at very competitive rates. In fact, many lenders will match a competitor’s rate. With that in mind, if your buyer is considering locking in, do not hesitate to ask an MLO to match a competitor. Additionally, as rates fluctuate, an MLO can educate buyers about the process of floating and locking in, and provide guidance along the way.
- Discounts and benefits for banking customers. Relationship banking is here to stay. Chances are if your clients are banking at a local institution, they will qualify for an added discount or incentive applied over the life of the mortgage loan. As their real estate professional, you can advise them on how much money they could save if you know the options your local banks offer. While incentives add value to the ordinary banking relationship, the ability to enter a familiar neighborhood store and begin the mortgage process makes the buyer feel more comfortable and confident about the process.
- Transparency and compliance. Stringent regulatory environments have made many buyers wary of the challenges and complexities in today’s mortgage process. As their trusted real estate adviser, if you have a contact at a local bank that can address your buyers’ questions about underwriting issues, you’ll be providing an extra service that will strengthen your business. Your contact can also clarify guidelines, due dates, and provide an entire overview of the process.
- Streamlined communication. The best MLOs are service-driven and proactive. They keep you and the buyer informed, from loan origination through underwriting to settlement. Most important, they view their relationship with you as a partnership and work toward the same goal: to get your buyer to closing. MLOs notify you and the buyer immediately when clarification or added documentation is required. Experienced MLOs understand timely communication keeps the process moving forward.
- Control. Connecting your clients with local MLOs can put them on a faster track to mortgage approval. Banks lend directly to the buyer and can make swift changes when special circumstances or exceptions arise. At TD Bank, for example, the decision to approve a loan rests with three individuals when issues arise — the region’s vice president of mortgage services, the MLO, and the underwriter. Deaccessioning complex loans is a local, team effort.
Of course, as in any business relationship, vetting the MLOs you work with is important. Not every bank or MLO will have what you or your buyers are looking for. Get to know the MLOs in your area so you can give your buyers more options. When speaking with MLOs, evaluate response time, follow-through, and accessibility, since these factors are important to a successful partnership. In the end, you will discover a few knowledgeable, committed, and dependable professionals who can become partners in serving your clients and building your business.