This will be a quick post but wanted to just give you a little insight on today's mortgage enviornment. It's NOT the same as it was 3 and 4 years ago. Loans are harder to get done; they are taking longer; and quite frankly we have a shortage of experienced people in the industry right now which complicates things.
We have people who have left the business for other jobs during the downturn and really don't want to come back for something that could be temporary. Or you had people leave who won't come back no matter what..
The problem we find ourselves in now is the heavy regulatory compliance environment coupled with low rates and massive refinance and purchase activity... the lenders just can't keep up.
One crazy statistic I came across was Wells Fargo actually employs I think 60% of the underwriters in the industry in the US. Just think about that for a moment..
Wells holds about 30% plus market share and 60% of the underwriters roughly..that doesn't leave a whole lot for the rest of the market.
The point I'm trying to make is these days we have last minute changes; last minute closings; and frustrated borrowers and realtors because deals are taking too long and the amount of documentation needed. I understand completely and borrowers and realtors are not the only ones frustrated with that process.
What people fail to realize is on the back end, lenders are being heavily scrutinized on paperwork and are experiencing high levels of buybacks. I've even heard some deficiencies (paperwork, etc, missing from the file) can carry fines as much as $15,000.
That's insane! But as you can see, this is why you see some of the documentation requests being made; it's not to be a pain in the neck, it's to make sure no deficiencies are found that carry huge fines.
There are even some lenders raising rates to price themselves out of the market because they can't keep up with volume.
Now you'll have some people screaming they are not having issues or can just slam your loan through no problems; make every closing with no last minute clitches and I would argue they are full of it. With this market the way it is right now problems are bound to happen.
That doesn't mean I'm being negative - it just means I set the right expectation with people upfront as we all have the same goals - close on time, make the customer happy, and get referrals. Our business grows from referrals and we want the experience to be the best for the borrowers and referral partners.
I think the most important thing to remember, regardless of the issues we face, is communication..
Communication, communication, communication - I think this would eliminate a lot of frustration if people would just communicate property, quickly, and be solution oriented.
Remaining calm and cool is crucial. Anybody can be calm and cool under good times; but under pressure and stress it's important to remain professional and solution oriented.
See my post here regarding mortgage application tips for consumers to make sure you are prepared at application to improve the processing and underwriting of your loan..
The more prepared you are at application the smoother the process will go.
Just rest assured your loan officer is very motivated to get your loan done quickly, smoothly, so you can move in or get your refinance done and have a great experience.
If you find that you're in a situation where multiple requests for documentation or extra time is needed just remember what I've said in this post regarding the back end and regulators because the ultimate goal is not to upset the customer or realtor; it's to make it a great experience so you come back, send friends and family, and deepen your relationship with the lender (purchasing other products and services)
To your success,
D..out..
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