How To Tell a Good Lender From a Bad One
Just like any industry out there, you have to separate the good from the bad as part of the process of determining who you’re going to do business with. However, one way that this process is a bit unique when it comes to your mortgage loan here in St. Louis, is you’re not dealing with spare change here… You’re dealing with one of the largest investments you’ll likely make in your life! That’s why I decided to setup a mini-guide here for you – A page that will walk you through some simple steps you can take to quickly eliminate the ‘bad apples’ from consideration – Before you waste a bunch of your time!
Unfortunately, most of the advice and articles and blog posts out there offering advice on how to pick a good loan officer gives…Well…To put it frankly, crappy advice! I’m not kidding here, I just read 8 other articles prior to writing this just to see what sort of advice was out there. And almost every “tip” went something like this: “Make sure to ask what your interest rate will be, you won’t know unless you ask” or how about this deep thinking gem: “Ask the loan officer what sort of training he has had, and how long he thinks your loan will take”. (Double face-palm!) Really!? This is what passes for advice these days? Is there a borrower alive who signs up for a mortgage without asking what the rate and payment will be?
No, this isn’t advice, this is click-bait! You don’t judge a good/bad loan officer based on random questions that you cannot verify. You want great service, communication and answers, and a consultative approach to your mortgage process! The above questions will tell you none of that. Which is why I created this mini-guide which is based on how I would investigate a loan officer prior to giving my business.
Let’s get started:
How To Pick The Best Loan Officer Tip #1
I don’t care what it is I’m shopping for, but the moment I come across someone who starts to get pushy with me during the sales process – I check-out mentally. More often than not, I simply walk away from whatever I was considering buying, as I can’t stand someone trying to force my hand. I’m assuming you have had similar experiences where sales people who otherwise would have had a sale from you blew it the moment they started to get pushy and tried to pressure you with fast talking sales techniques?
Yep, that drives me nuts, and I always give this as the first warning sign to look for in a loan officer. Why? Because this is your first sign of what I like to call “commission breath”. It means the primary thing on their mind is not how to help you, or get you the best loan that will fit your needs. But rather how to get you to sign on the dotted line right here, right now. Not a good combination when dealing with something so important! So look for that high pressure, pushy approach, and slick sales techniques… Then scribble their name from consideration! (immensely satisfying!)
How To Pick The Best Loan Officer Tip #2
So item #1 on the list is a perfect lead-in for item #2 which is: Does the loan officer you are considering take the process of providing you education regarding the loan process seriously? As mentioned earlier, this is a large investment for you – A good loan officer will take the time to make sure you are informed every step of the way. A crappy lender however, could care less and just wants you to hurry up and make a decision so you can sign the paperwork! One way you can get an idea of how seriously a lender does/doesn’t take the education process is to look at his/her website.
Is the information specific to your area, and the type of loans you’re considering? Or does the site just read like every other mortgage site out there, signalling that it was likely just a canned, template that was purchased and thrown on the web just so they could say: “Look! I have a site too”! – I’m hoping that as you read this, you can tell that I take my job of helping home buyers and borrowers very seriously. It’s my responsibility to make sure you are well informed, and that pros and cons are pointed out every step of the way. This is what should shine through, even on the website if the loan officer cared enough to put forth the effort.
If you still can’t tell by looking at the site, why not a quick conversation with him/her and see what your gut tells you? Ask yourself after the conversation if you were left feeling well informed and comfortable? Or did you leave feeling a bit stressed out, or even frustrated? (In some cases you may feel like “meh” is the only way to describe how you feel – That’s not a good sign either!)
How To Pick The Best Loan Officer Tip #3
Now we get to the sneaky stage… (Rubbing hands together) – Ok, so perhaps it’s not really all that sneaky, but it does involve you taking a few very specific actions, and watching the outcome closely as a means of gauging if the loan officer you’re considering has really earned your business or not. I began making this suggestion years ago after I had read that the # 1 complaint from recent home buyers, or borrowers was that their loan officer was terrible with communication. Slow to call back, light on the details, and even waited days to tell them about serious changes to their loan status!
Unacceptable right? If you agree, then here’s what you can do about it:
A. Go to the website and check for a live chat/support button. If they have one, use it. If it’s offline, leave a message…
Why: In todays day and age, you need multiple methods of reaching your service provider. If they’ve put a lot of thought into communication and convenience, then a live chat/support button on their website is a given. If there is no button, then you dock them a point or two. Not a deal-killer, but still something to consider. Professionals who care about communication and convenience for their clients and prospects demonstrate it by putting multiple means of communication onto their sites.
B. Try sending the loan officer an email, or a contact through their site – And track how long it takes to get a reply. If it takes longer than 24 hours, then you’re likely looking at even longer response times once you’re a client! This should be a red flag.
C. Check Google, Yelp, and LinkedIn for reviews from former clients. On average, are the reviews positive?
See, there’s no one hard and fast rule for how to determine if a loan officer is good or bad. However, if you take all of the above into consideration, you should begin to see a fairly clear picture of what to expect from a loan officer. Pay more attention to the actions, not the words. No professional is going to come out and say “Yep! I give crappy support”! Rather, they all will tell you how great their communication, and response time is. Which is why I’m recommending to let the actions speak louder than the words! Put it to the test, and then you’ll know first hand what to expect more often than not.
Oh, and by the way… Should you wish to check what my former clients say about me, here’s where you can read the original reviews: