Thursday, February 18, 2021 / by Tom Dinnegan
Purchasing a home, whether you are a first-time buyer or a seasoned veteran, is a complex process and most likely the largest financial transaction in your lifetime. Therefore, it is important to have the right team for the job. In addition to your Realtor and Escrow Officer, your Loan Officer (LO) is a key member of your home buying team.
A top-notch LO has excellent problem-solving and project management skills and is reachable, responsive, and creative; look for the 5 traits that make a LO stand out:
1. Reputation and Experience - A lot of business comes from referrals; many homebuyers look to the people they trust for referrals (real estate agent, family, friends, and/or financial advisers). Ultimately, a LO should be viewed by the borrower as reliable, responsive, knowledgeable, helpful, and trustworthy. There are many choices when it comes to finding a lender to finance your purchase and it is important that you select one you can trust and has the experience and reputation to protect your interests.
2. Product and Pricing Knowledge – A detailed understanding of investor underwriting guidelines and loan program pricing is key to finding you the best priced loan program and loan structure. With multiple mortgage investors, each with varying guidelines and pricing models, your LO must have a detailed understanding of the intricacies of all of them to provide you with the optimal outcome.
3. Constant and Effective Communication – The home buying, and lending process involves numerous moving pieces and a substantial amount of information that is collected and processed. Your LO needs to communicate these to you in a consistent and understandable manner. They must be transparent with you (the borrower), and your Realtor. A great LO is open and forthcoming with you and your realtor about all important information that has an impact on your loan. Whether good news or bad news, the LO must keep your team informed; your LO should never over-promise or under-deliver.
4. Analytical & Data Driven – Great LOs are detailed oriented and can easily handle complex loan structures and perform detailed analytics. This trait enables the LO to navigate the numerous loan program pricing models to obtain the best priced mortgage loan that meets your specific needs. And the LO is equipped to maximize a buyer’s buying power by analyzing various loan programs and balancing the debt-to-income ratio and loan-to-value constraints.
5. Team Player - The best LOs know they must function effectively on a team. This means collaboration, effective and constant communication, and the ability to solve problems as a team. Whether the Lending Team (LO, Loan Processor and Underwriter) or the Real Estate Team (Realtor, Escrow Officer and LO), teamwork is critical for a smooth and successful home purchase.
An excellent source for information on a LO can be found on the Nationwide Mortgage Licensing System (“NMLS”) website (https://nationwidelicensingsystem.org/Pages/default.aspx) which was created after the mortgage implosion of 2007 and the resulting financial crisis. It requires that all LOs be licensed at a national level and meet minimum educational requirements. Using the NMLS Consumer Access tool (https://www.nmlsconsumeraccess.org/) you can find your LO and obtain their licensing information, Employment History and any regulatory actions, if any, that have been filed against them.
Tom Dinnegan, MBA Finance
LO - NMLS #1882118
Priority Financial Network
Real Estate Advisor - DRE# 01920770
Salzman Team, Engel & Völkers LA – South Bay