Validate Experience Of Mortgage Broker - Short Sale Leadership
During the days when credit was easily available
, many joined the ranks of mortgage broker, who were motivated by the commissions available for each loan they would create. The bar for loan qualification was low, and there were loan programs available for those who had little or no income. This was a period where getting a loan approved was a mere formality.
The foreclosure crisis has created banking reforms, making loan qualification a much more difficult process. Mortgage brokers have a much smaller pool of buyers with whom they can service, and face a more stringent documentation process. This has created a weeding out process where many have left the industry because the easy money is no longer available, their population of potential buyers has decreased, or that the new documentation process has become too difficult.
These new marketplace realities have resulted in an exodus of mortgage professionals, and an industry where the only dedicated and educated mortgage professionals are still in business. When selecting a mortgage professional, ask the pre-qualifying questions:
How many short sale transactions have you funded?
Are you able to fund within 30 days of receiving the short sale approval letters?
What loans or programs are available to maximize the chances of funding this short sale transaction?
In one of our short sale transactions, we worked for 3 months to obtain short sale approval letters from the two lienholders. They gave us 30 days to close, and even a 30-day extension because the mortgage broker requested a little more time to close. After the end of the 30-day extension, we found that the mortgage broker still was not able to fund the transaction. Upon doing further research on the background of this broker, we found an absence of experience with short sales, and a lack of overall experience with loans. At this point, another extension was required in order to avoid the property being foreclosed with a trustee sale. However, the lienholders were unwilling to grant another extension as they had no confidence in the mortgage brokers ability to fund the transaction.
There is a tendency for buyers to choose a mortgage broker due to a pre-existing relationship, or for a buyers agent to refer their clients over to a preferred mortgage broker. Because of the tremendous amount of time invested in getting a short sale approved, it is imperative that we use mortgage professionals who have a solid track record of successfully funding short sales.
Look out for our future blogs/articles from our Short Sale Leadership Series content.To view our blog updates, visit www.whbsolutions.com/blog
by: Art Lee
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