Part 3 of Team work

Seller down payment assistance with FHA loans is gone (Ameridream, Nehemiah, etc.) What that means, in essence, is also gone is the 100% financing option. As a Realtor, if you were reliant on 100% financing options, then you weren't selling real estate! It's not as tough to sell property if financing is readily available, financing is relatively cheap, and property values are going up faster than appraisers can turn in reports. All you have to do in that environment is show up, write a contract, and get the approval that wasn't too difficult to obtain.

Enter the credit crunch, housing slump. Things changed and tightened before a lot of Realtors could adjust their selling techniques to suit that change.

** Lets say you have a resteraunt that you love. Every day you go there to eat and order the exact same thing. One day you show up and that item is no longer on the menu. The chef is an outstanding chef though and you know that so you just order something else and it's every bit as satisfying as the meal you used to order. In other words, although you may have been in the habit of one particular meal, and now it's gone, that doesn't mean you quit eating there, it's a good place to eat! Flip that over to mortgage financing and real estate sales. You've lost a menu item and you really liked that menu item. Well, if your chef was really good, or your mortgage lender, then you don't quit going there. You know he/she will take good care of you regardless of what changes are made to the menu. I'm the best chef in town!

That said, rely on your mortgage lender for advice, not just"what is the rate today" or"what are your fees?" Rely on your lender as a teammate that you can call on when you need to take good care of your client. If you (or your client) is too caught up in rates, too caught up in what the good faith looks like, too caught up in the menu of mortgage products, then you're fighting a losing battle.

Call 5 mortgage lenders tomorrow that you don't use but that are in town. Don't tell them you are an agent. First of all they won't answer because they don't cook on Saturday. But when they call you back, just ask them "What do your rates look like today on 80% financing for a purchase?" If the answer is ANYTHING other than "I can't give you a quote with any conviction until I know what the credit score is, what the property is, what the property usage is, and what are we looking at as closing date?" Every single one of those questions is going to impact rate and therefore "tweak" the menu. A borrower with a 780 credit score and 20% down payment is going see anything and everything from 6.25% up to 7.5% (based on today's rates and potentially higher really) on a 30 year fixed rate mortgage. Yes, I'm telling you that the identical borrower, with the same score, same product, same down payment, same loan amount is going to see as much as if not more, a point and a quarter + difference in rate if a loan officer gives them an accurate and truthful answer. The reason is loan level pricing adjustments and that's boring so no one talks about it or explains it. When a Realtor asks me "what are rates?" I answer very quickly, "how much does a house cost?" Seems silly but think about it for minute and get back to me.

My point is simple, your team has to be comprised of great chefs. An Itallian Chef, a French Chef, a Japanese Chef, and so forth. Because one chef can't be a great chef at all types of cooking and you need to know that regardless of what your client is in the mood for, you have a chef that can have food made to order on the table to satisfy today's need.

By the way, call me tomorrow, I will be in kitchen.