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A recent study conducted by Inman, a real estate information firm, found that almost 50% of the realtors surveyed preferred to do business with a Mortgage Broker, over a Bank or Independent Mortgage Banker (Preference).
Surprised? Maybe you shouldn’t be. Brokers have become a little more flexible when it comes to courting Realtors and other business sources, than other mortgage lenders.
Most Brokers keep their operations lean and mean, mainly concentrating on loan originations. Once they have the loan, they do preliminary processing and gathering of required information and pass the loan on to a lender to approve and close the deal.
The heavy lifting is then done by the corresponding lender. This is not to say that Brokers don’t work hard, it’s just their work is more concentrated in one area, allowing them to minimize their cost to operate. Many are small shops keeping their overhead to a minimum.
All that being said, there exists the possibility that many of the Realtors surveyed may not know the difference between a Mortgage Broker and Banker. This is not to insult the Realtor. They may believe they are dealing with a Broker because the originator can bring a number of different products from different sources to the table. However, in reality, today many Mortgage Bankers operate the same as Mortgage Brokers in that regard.
In the end, it all comes down to trust, dependability and service. Notice that at the end of the article, price and/or rate were not mentioned as issues the Realtors view as important in recommending a lender. When their reputation (and commission) is on the line, they want someone who will deliver, as expected, and on time. They prefer to refer the best, because they’re worth it.
- Are you in that category?
- Can you offer a diversified menu of loan products?
- Do your lending partners, or back office, deliver service timely?
- With TRID just around the corner, this will become paramount to your continued success. The new 3 day Closing Disclosure requirement will be put a strain on many a lender.
- Will you continue to meet the closing dates on time?
- Is your company or correspondent lender TRID ready?
Whether Broker or Banker, don’t get too comfortable. Preference can be fleeting. As they say, “You’re only as good as your last deal”.
Be sure your customers, Realtors and consumers alike, have a lasting impression that you delivered professional, quality service that they expect and deserve. There is no substitute for quality. Most prefer it to price.
You need to give preferential treatment to receive it.
