Could I Please Get a Freaking Rate Lock Extension??? – Read At Your Own Risk!
Let me be brutally clear. This blog post is not for the faint of heart, so read at your own risk…
Why do originators seem to be needing rate lock extensions these days? Is it because they were “caught off guard” with the huge rate spike? But then I ask myself if you are a mortgage professional, shouldn’t you have know that mortgage bonds were over bought and would spike at some point? I mean for goodness sake, even if you don’t subscribe to a rate alert service, you had to have been living in a cave to not know that the market is wildly unpredictable and has been for some time now, so why would any loan officer tell someone they can close in 30 days or worse yet float a rate or even lock for 30 days.
I mean come on gang! No one can possibly predict what conditions an underwriter is going to ask you for. No one can possibly predict what the HVCC appraiser will value the home at or even get the report turned in.
And for those originators who want to say that I don’t understand because clients are rate and fee shopping them, I do understand and the next client who ask you about rates and fess should be educated that that is the wrong question. The right question to ask is, “can you fund my mortgage loan before Jesus returns, or can you even fund it at all?”
That would be a great question for customers to ask, wouldn’t it?
At any rate, let me continue…
Now customers are ticked, loan originators are scrambling, and agents are screaming! There has to be a better way!
At some point in life you have to wake up and realize that having to put out a constant bunch of fires is no way to make a living. At some point we need to wake up and become proactive in our approach. We must set proper expectations with our clients, our agents, and ourselves.
But, Tim, you don’t understand! The clients and agents are pushing me to get it done!
Really? Who is leading who here?
At some point you have to stand up and take charge. Those who are with you will follow and those who aren’t will drift off into the hands of blown rate locks, delayed closings, and mortgage hell. Let them go.
What originators need to do is set proper expectations and here is the plan to do that…
- Recognize that the market has changed and you need to let your customers and partners know. Understand that you can not out guess underwriting these days.
- Educate them on doing 60 day contracts or 60 day rate locks. Give them horror stories of those who didn’t head this advice and how it cost them.
- Bring you confidence to the table. That means that you need to be polite but bold and willing to let the client walk if they won’t line up with the program.
- Establish a From app to closing system. Become proactive and make sure you are keeping everyone in the loop on the status. I recommend you call them so much that they want to change their phone number.
Becoming a proactive leader means that you set the rules for doing business with you and you understand that not everyone will jump on board. Some will, some won’t, so what.
Plan for the worse and hope for the best and you won’t get caught in rate lock extension hell.
Are you comitted, find out here…