Reputation & the California Mortgage Lender
Logan Landers: "Ours is a referral-based business. Nearly all ours
is by referral."
“I
hear all the time the borrower is promised one thing, and when it's time
to sign the docs, it's a whole other story.”
And this is exactly why a mortgage lender's reputation is so important!
What percentage of your business is referral based?
Nearly 100 percent.
Really? Wow! What is the California mortgage lender average?
I don't know but I would guess it's 20%. The vast majority of mortgages written in this country are rip-and-tear, burn-and-churn, and therefore almost always disqualify themselves from referral business.
What are the chief complaints about California mortgage brokers?
Senior Loan Consultant Dennis Anderson: I hear all the time the borrower is promised one thing, and when it's time to sign the docs, it's a whole other story. That's probably the biggest one, and also, what we already went over, that they are gouged with the cost, with three, four or five points on a loan.
My girlfriend has spent about 35 years in banking. Her primary example of a California mortgage lender bad boy is: It's a 90-day escrow, the broker promised you 1 point and a 5.5% rate. On Day 80, you find it's 2 points and 6.5%.
Dennis: That is it exactly!
She says it's too late to change the deal and you have to close anyway.
To elaborate on what Dennis said, California is what is called a dry funding state. That means when you sign your loan documents, the money doesn't have to be there. In some states, when you sign the loan documents, the banker is compelled to fund the loan. This is the game. It's a bait-and-switch game where, all the way down the line, as your girlfriend said, you're told one thing, and then, bang-bang, five days before the close of escrow, the deal is changed.
That's much more of a predicament, by the way, as I'm sure you can understand, for a purchase than a refinance. In a purchase, you're getting ready to move. The seller is waiting for his money, so this deal is ready to go. If the deal is changed, you're stuck. If you don't complete the transaction, you're going to lose the house, or you may get sued by the seller, and all this stuff begins unraveling. Whereas in a refinance transaction, it's less critical, although if the buyer is getting cash out on their refinance, and they need the cash, you could push the borrower into a corner. The circumstances are just different, but it all adds up to bad business practices designed to corner the borrower at the last second. To essentially leave them no choice. But, of course, most borrowers don't forget when it comes time to pick a mortgage professional next time they have a need.
Why should someone choose you over any other mortgage broker?
The truth of the matter is, we are all offering the same product, so you have to distinguish yourself in some manner. The way we distinguish ourselves is that we try to look at the customer as somebody who will be our customer for life. Within the scope of that, understand that it is not only beneficial to them, it is beneficial to us. We give them a fair deal on a transactional basis, but we have the ability to make money on every transaction.
The average homeowner is going to wind up with five or six loans in the course of their life. So we see the benefit in keeping the customer, because at the end of the day, if you're not keeping in mind their best interest, they will recognize that, and the next time they will take their business someplace else.
California Mortgage Home Loan Brokers,
a Los Angeles mortgage company
Attn: Michael McKown
16027 Ventura Blvd. Suite #500
Encino, CA 91436
818-841-0051 Local
888-632-9939 Toll Free
E-mail to Michael