How To Find An Investor Friendly Loan Office
By JD Esajian on August 7, 2017
In the real estate world, it is important to constantly build your team. By surrounding yourself with good people that provide a specific service you can close more deals and maximize your bottom line. One of the biggest shifts in the industry over the past decade is with how investors fund their deals. In the past mortgage brokers and lenders accounted for a majority of all transactions. Today, hard and private money lenders have taken up a portion of that space. Contrary to what you may have heard there are still traditional loan programs out there. They may not be as abundant as they were in the past but they are out there if you know where to find them. A good mortgage broker that has access to certain banks and programs can help add one or two more closings throughout the year. Here are five things you should look for when shopping for an investment friendly loan office.
- Updates on new products. There is a huge difference in a loan officer that works for a bank and one that works for a brokerage. A traditional bank has limits on the guidelines and programs they can offer. They may be able to provide personal service but they are limited in their programs. Unless you have exceptional credit, documentable income and strong down payment you may be better off reaching out to a mortgage broker. The first thing a good broker will do is keep you updated on any new programs and guideline changes. Lenders have started to slowly roll out subtle tweaks and program changes. Some of these may not have any impact to you at all but some can open the doors to a new way of financing deals.
- Professional business approach. There are a few different benefits of working with a good mortgage broker. Obviously, they can help find programs for your purchases but they can also help with any properties you are selling. You want to refer any prospective buyers to someone that can get your deal closed. They are a reflection of you so they need to be reputable, honest and always have the buyers best interest in mind. A professional mortgage broker with a long-term view of the business will gladly fit this bill. You also need to make sure that they can really do what they say they can. Anyone can send over a generic prequalification letter but unless they can back it up it doesn’t mean anything. You don’t want a broker who says they can do every deal. You want one that is up front and honest with you as to what is really going on. If there are potential issues you want to be alerted of them as soon as they present themselves not weeks after the fact. The mortgage collapse wiped away most of the part time and unscrupulous mortgage brokers. With increased education requirements, you can be confident that a broker you work with today is in the business for the long haul.
- Non-owner-occupied options. As an investor looking to buy you want specific loan programs that fit your needs. Most non owner-occupied programs call for 15-25% down payment coupled with strong credit scores. A mortgage broker may have access to programs with 5% less down or a lower middle credit score. On the surface, this may not seem like much but can equate to thousands of dollars. On a $300,000 purchase 5% is $15,000 that you can use in other areas of your business. A program with a reduced credit score can not only help with the approval but may be able to give you an interest rate you wouldn’t be able to find anywhere else. Don’t be afraid to specifically ask your broker what types of non-owner occupied programs they offer.
- Quick closings. Time is of the essence in real estate. The ability to close just fifteen days quicker can give your offer an advantage over your competition. A good mortgage broker knows what is needed prior to the lender asking for it. This foresight allows them to collect items in advance and expedite the process along. After closing a deal together, they will store all your information on file so they have it when you are ready to buy again.
- Specific programs. In recent years there has been a trickle of stated income programs back to the market. The handful of lenders that write these loans require increased down payment and strong credit scores, but they are available. Whether it is a stated income program or some other niche you want to work with a broker that has access to unique programs. Some of these programs will not be for you but some will be exactly what you are looking for. We will never see the rush of exotic programs that were available last decade but there will be more creative loan options in the future. You want a broker that works with dozens of banks and has access to all the latest programs.
Simply put, yes you can find an investment friendly loan officer. The key is to network with as many different people and events as possible until you find the right person. Once you find someone you are comfortable with stay in contact with them every so often and constantly build your relationship.