Spotting Mortgage Lender Red Flags: Don’t Fall for These Costly Traps!

Transcript

Have you ever heard the phrase that something seems to be good, too good to be true? It probably is. Well, that definitely applies to lending. So, especially with getting a mortgage. So, we’re going to identify red flags and what you need to be aware of and how you can Avoid these because when you choose a lender, sometimes you’re in so far, you can’t get back out.

So that being said, first red flag, beware of lenders are promised extremely low interest rates with no catches. There has to be a reason behind it. We’ve got lower interest rates than most companies, but we’re also a little bit smaller company, a little bit more efficient. There’s lower overhead. That makes sense.

If you’ve got a big company with tons of overhead and they’ve got these amazing low rates that nobody else is offering, right? Yeah. Might be a bait and switch situation. I get this all the time. My clients, I’m like, I know these people, they’re just saying that to try to get you in. Then once you’re committed, you can’t get out.

So when these, these bait and switch, watch out for the bait and switch. And a lot of times desperate people do desperate things. So second red flag, cautious of lenders who don’t thoroughly review your financial situation. I get it all the time. They say, Oh, this other guy said, Oh, don’t worry about that.

Don’t worry about that. And when I ask qualifying questions such as, Did they address this? Because you’re self employed. Did they look, you’re more than 25 percent earned. Did they, do they know Fannie Mae rules? Do they know that these rules apply, that I need to see the financial institution funding your W 2 because you’re more than 25%?

So, and they’re like no, they didn’t mention that. I’m like, well, I can show you the underwriting guidelines. And that’s the difference between a qualified lender and a salesman who just wants to get the deal. And just hope it’s in there and passes it on to somebody else. And those are the compartmentalized lenders.

Those compartmentalized lenders, once it’s off their plate, they really don’t care because it’s somebody else’s problem. So, third red flag. Watch out for lenders who pressure you into borrowing more than you’re comfortable with. They can say, oh, don’t worry about it, or they promise these huge rate drops later.

Now, we know rates could, rates are cyclical, but you don’t count on that. You don’t push somebody into a big loan on the promise of that because nobody has a crystal ball. Unless you have a time machine and you go 88 miles an hour down Main Street, you’re not going to know whether they are going to drop.

You can hope, but you can’t guarantee it and you don’t want to stick somebody 30 years worth of payments based on that promise. So before committing no mortgage lender, do your research, ask them qualifying questions like who is working on my loan in the middle of this? Who’s doing the hard work? If they say my well qualified assistant, you ask how many years experiences this person have because they usually put kind of the slick talking guy in the front.

He’s got lots of experience. It gets people confident. They pass it off to their well qualified assistant who doesn’t, who makes just a fraction of what they do, but does all the work while they’re out golfing. And you’re dealing with somebody who’s either a Maybe not good at their job or maybe just learning on your file could be good people.

I don’t want to say anything disparaging, but if you’ve done loans before, you know exactly what I’m talking about, how painful this is. They lose things or maybe they’re just overworked while this guy’s all golfing. He’s just getting tons of loans in and then this, this assistant making 15 an hour is just overwhelmed.

Not only that, they’re just like, they’re constantly thinking, is this worth the pay? And we’re not paid very much. because somebody has to pay for that golf time. If there’s if there’s a ship and people are not rowing, somebody’s got to pay for that. And they usually comes to the form of, I don’t want to call it slave labor, but low income, low revenue labor.

So think about that when you’re doing a long term, mortgage is a long term commitment and you need to be aware of the organization that’s giving it to you. We’re transparent here. We can tell you exactly who’s doing what on every single component. Most of those other companies don’t even know that it changes so much.

They’re just kind of disorganized. So we appreciate your help and we want you to look for these red flags and making informed choices. Thanks for watching. You found this video helpful. Please subscribe and call us, email us or send us a message and we’ll answer right away. We’ll answer all your lending questions.

We’re here as a knowledge base for you guys. So you make the best choices moving forward with the biggest purchase in your life. Thanks.