An interesting article was published by NAR Mag where they site a CFPB study that encourages rate shopping on-line. Do you encourage your FTHB to use rate-shop-sites?
Comments
additional comments on "NAR Encourages Use of Rate-Shop-Sites"
Comments are closed.
Mitch Wright, you took the words right out of my mouth. There are “ok” Realtors out there, and there are “Great” realtors out there. Shouldn’t NAR want that 1st time home buyer to have the best experience possible when working with a Realtor as well??? If thats the case, the home buyer should definitely speak with 3 Realtors to see who is going to really go to bat for them during negotiations….just sayin.
I had a client who was working with a part time Realtor, about 6 months after TRID went into play. When the Realtor asked why there was a 3 day waiting period to close, I explained it was because of the new TRID laws…The Realtor asked me… and I kid you not; “Whats TRID?”
The comments you state at 3:30 into the video are what matters here. Business of any type is built upon relationships and the high-stress that surrounds a home purchase can be minimized by dealing with reputable, client-oriented local professionals, including Realtors, Loan Officers and Risk-Management experts.
Shame on any of us who does not demonstrate the benefit of doing business with our firm and with us, personally, over an unknown entity that might save them $9 a month.
The issue is whether or not getting a mortgage has become a “commodity”. Fourteen years into the business, I would argue that it’s not.
When having this “pricing” discussion with potential borrowers I say the following : “look, I have clients who shop at Nordstroms, some who shop at WalMart, and some who go to Marshall’s. I really don’t care where you shop, but when you walk into a Nordstrom, you have an expectation of the level of SERVICE you will receive there vs the others. I will provide you a Nordstrom’s level of service on this the biggest transaction of your life.”
The “Reality” is that the buyer would save much more money buy shopping Realtors and using one who works for 3% commission vs 6%, acquiring the property for 3% less money. With an average price of $150,000 that $4,500 savings equates to approx $25/mo payment savings AND more importantly, 5 years down the road when the Buyer Sells they will not only have saved the $1,500 on their payment they will also have $4,500 more real equity. This equates to a $6,000 increase to the buyers net worth! Why wouldn’t every Realtor see the benifit to the client and work for 3%? Isn’t it the “Right” thing to do?
Even though this makes tremendous economic sense, would you ever refer your clients to the “Kmart” Realtors vs the “Dillards, Macy’s or God forbid the Nordstrom’s” agents so the buyers process is smooth, enjoyable, stress reduces and a pleasant REFERABLE solution based TEAM who works for them? Do we as an industry want the process to be viewed as an enjoyable one that they will want to go through multiple times in their lives or such a Horrible “Root Canal” experience that they hunker down and never want to buy again? Our economy needs us to do the best job possible so it is enjoyable because we drive the economy!
The 3 card thing is an excuse! If you refer the RIGHT lender who cares about your client, takes care of them and makes the experience positive, closes on time, on budget (whatever that is presented to be), adds value and communicates effectively there will never be a complaint therefore never need to hide behind the “3 Card Rule”.
I think it’s a great idea, but you are so correct, this is not reality!! Plus are you really going to screw up your first time Homebuyers credit score by telling them to shop around. If your Lender is truly doing their job they are going to want to pull credit on the buyer to make certain that they are really ready to buy. If all the lenders they shop do this, by the time they are done, they are not going to be able to get a loan because you just succeeded in tanking their credit scores.
If NAR is going to promote “shopping lenders” to buyers, if they want what is best for the consumer they should also promote “shopping realtors” to home sellers.
LOL……I make a living on Borrowers calling 3 lenders…choosing one… then getting 3/4 of the way thru the transaction and get turned down…Then I pick up the pieces and close their loan in 2 weeks ….Its kinda easy because the appraisals are already done …title is done ….just fit the client to the proper product and lender(im a broker dont you know)…submit a full package and close…So NAR can go right on ahead and have them call 3 …Ill take the fall out …My question is why do Realtors keep making the same mistakes and allowing their buyers to do this when they know it doesnt work…Sometimes this isnt about rate ..its about getting the job doen in a timely fashion …Ive never sold rate ..always knowledge and getting the job done…Good show
Correct me if I’m wrong but doesn’t the actual price of the home also have an impact on the buyer’s monthly payment. What if the CFPB came out and said that agents can no longer have contracts with their buyers. Should the lenders then suggest to the buyer to shop their realtor once they are under contract? Maybe they can find a selling agent that will accept less commission which would reduce the price of their home?
Of course I don’t believe in this but it is astonishing that real estate agents don’t have to live up to close to the same criteria as lenders.
Just more questionable advice from NAR–formally a strong trade association and now an organization that looks and acts like a union.
This crap from the CFPB is based on typical liberal logic; business is bad and you’re going to get ripped off if you don’t shop sufficiently. Nearly all lenders have similar pricing on any given day. I was in lending for 25 years and am now in title, and I can tell you the worst settlements involve out-of-town lenders who never met the borrowers and know nothing about the local markets.
Per previous reply above, ya, right after I get that realtor referral I encourage my buyers to go use Redfin or some other realtor that offers kick backs and commission cuts. Afterall, they can therefore low ball their offer vis a vis the lower total commission and the price cut can save them $8.31 a month!!!