Remember real estate school? All those hours of lectures that sounded like they were being delivered in another language that taught us nothing about how to list and sell real estate.
Of course we did learn that there are 43,560 square feet in an acre and something or other about riparian rights. But how to fill out a listing agreement or figure out a home’s market value was not in the school’s curriculum.
What’s worse is that they cut us loose to take the state licensing exam, which to their credit they did prepare us for, and then to work with consumers. If we were lucky we found a broker willing to tutor us on the rudimentary ins and outs of working in a real estate office and how to fill out the paperwork.
I don’t recall anyone, not my broker or my mentors, talking to me about the mortgage process, do you?
The word “value” has almost become a cliché in the real estate industry. Bringing value to the consumer/agent relationship and proving your value has proven to be of utmost importance in this business if you hope to set yourself apart from other agents.
So, just what is this “value” of which so many speak? I like to think of it in terms of what consumers find valuable and they overwhelmingly want satisfactory customer service. They want phone calls returned promptly. They want explanations of the process, in plain English.
Since a buyer’s second step (after figuring out their budget and where they stand credit-wise) is always a visit to a lender, how much do you share with them about the lending process? On second thought, how much do you know about it?
It’s understandable that many agents don’t know much about the process. Most of us came from other industries and getting the real estate process under our belts quickly was job one when just starting out. That and figuring out how to find clients so we could get a paycheck.
As time goes by it just becomes easier to give our buyers a rote “go see Joe, he’s my lender and he’ll fix you up.”
If you are lacking on the finer points of the mortgage lending process, it’s easy to remedy. Use your lender as a tutor or surf the Internet for articles written for newbies to the process.
There are so many steps on the road from loan application to closing. To be of real value to your clients you’ll need to be able to explain the debt-to-income ratio and how it’s used, the underwriter’s role in the process, the title report, appraisal and, most important, what to avoid doing after they get the pre-approval.
Now that you’re a mini-expert on the mortgage process, you’ll need to communicate this knowledge to your clients.
The smart buyer’s agent holds a consultation before taking the client to even one home. If you are included in this group you understand the value of this meeting. You’ll learn more about your clients and what they can afford, what they want and whether the two mesh. This is the best time to talk to them about getting pre-approved and everything you know about the loan process.
From start to finish, they should leave the meeting with a full understanding of what to expect every step of the way.
If you prefer to use a buyer presentation packet, as many agents do, include a sheet about the loan process. Using photos or even an infographic helps liven it up and makes it more interesting and easier to understand.
If all else fails, use the Buyer’s section of your website to educate potential clients about the mortgage process.
Create a page on “Steps in the Home Loan Process” for the Buyer’s Resource section and direct your prospective buyer clients to it.
If you work with a lot of veterans or first-time buyers, have separate pages that deal with VA, USDA and FHA loans. Although the process is similar, there are enough differences between these guaranteed loans and conventional loans that an explanation of the processes is necessary.
This is especially true if your buyer is interested in purchasing a condo with an FHA-backed loan.
Your clients crave information on every aspect of the real estate transaction and this includes the loan process. Cater to that craving and watch your referrals soar.