Four Things a Good Loan Officer Will Do For You
From the moment you get pre-qualified until the day that you close, your loan officer, along with your real estate agent, will be your two most important contacts.
Many first-time homebuyers will select their loan officer based on a recommendation or online reviews. Once the escrow process starts, life gets stressful and you could feel lost amid an avalanche of details about pre-approvals, loan estimates, and the like.
In this article, we’re going to give you a list of qualities that every good loan officer has. Use this list as a litmus test for loan officers you’re interested in hiring, as well as a reference point to which you can refer when the mortgage process seems to be hitting some roadblocks.
A Good Loan Officer Knows the Market
Mortgage rates are in constant flux because of the forces exerted on them by the markets as a whole. For example, a down economy usually means that mortgage rates go down. And, as we’ve seen over the past two years, a strong economy means that mortgage rates will go up.
But, on a day to day basis, your loan officer’s understanding of what’s happening in the mortgage-backed securities market (MBS) will be crucial in getting you the lowest interest rate on your mortgage, says Adam P. Smith, president of The Colorado Real Estate Finance Group, Inc.
“Mortgage rates are a moving target and could have enormous fluctuations over that period,” Smith said. “A good loan officer knows what the MBS is doing, what is going to affect it, and what the ideal times and days will be over that period to ensure their client is getting the very best deal the market can bear.”
When you’re narrowing down your list of lenders, ask the loan officers you’ve been emailing or talking with about how they choose your mortgage and if they follow MBS trends. Even a tenth of a percent difference can cost you thousands of dollars over the life of the loan.
A Good Loan Officer Will Order Your Appraisal and Title Search
Your appraisal and title search are big hurdles in the escrow process. The appraiser validates (or invalidates) the contracted price with their own valuation of the home and the title search will reveal any issues with claims to the home’s title.
Both of these important steps should be taken care of by your loan officer. He or she should keep you in the loop as to when the title search starts and when the appraisal will happen, says Tennessee-based Realtor Leneiva Head.
“The lender will submit an order through the appraisal system in order to secure an appraised value of the home. They will also submit an order to the title company to secure a title search. This confirms that the buyer receives a clear and insured title at closing,” Head said. “Both of these steps protect the interest of the lender and the buyer.”
Giedre Trahan, a loan officer with Fairway Mortgage in Aurora, CO., notes that the appraisal should be a priority because closing the loan can’t happen without it.
“Because the loan officer is dealing with the financing of the deal, they are responsible for communicating with the real estate agent and title company and making sure that everything is in order before closing,” Trahan said.
A Good Loan Officer Is in Constant Communication
Getting a mortgage is a stressful, invasive process. When your loan officer isn’t communicating with you about important deadlines and paperwork requirements, that stress becomes an infinitely bigger menace.
Therefore, it’s crucial that your loan officer or his or her prep team communicates with you every step of the way, says Ralph DiBugnara, president of home-education site Home Qualified.
“The loan officer needs to communicate with you in a timely fashion to make sure your commitment is delivered promptly and on time,” DiBugnara said. “If it is not delivered by contract date, you could be in risk of losing your deposit so it is imperative that it is handled in a timely manner and that those time frames are communicated to all parties involved in the transaction.”
A Good Loan Officer Will Be There on Closing Day
Closing day is a huge relief for homebuyers – it’s that final day when you sign papers, money is wired and you walk away from the closing table with a home.
A good loan officer will be there at the table with you, providing answers to questions and supporting you as you work through the mound of paperwork you have to sign.
He or she will also confirm that all required payments have been made and that the funds for the purchase have been wired by the lender to the buyer.
Also, notes GHM Mortgage Services LLC‘s Aimee DeVries, the closing table is a great place for loan officers to make connections with real estate agents.
“When the mortgage package is complete, use this time to strike up a conversation with the listing agent and the sellers,” DeVries said. “Hopefully this has created a comfortable environment for you to ask the listing agent if they would like to meet up for coffee and discuss doing more business together in the future.”