What is a mortgage originator?
A mortgage originator (also known as a loan officer) is a professional who seeks the best mortgage terms for you. Using a mortgage originator provides a personalized service for all of your financing. An originator has access to many lenders, with each lender offering different programs to fit your needs. This provides you more options, not just the cookie cutter options your bank maybe offering. While an originator may have relationships with the country’s biggest lenders, a mortgage originator is not beholden to any of them. Their expertise can save you time and money. Two precious things today.
Some people don’t want to spend the time and energy seeking out the best mortgage, by contacting a range of lenders, obtaining information about interest rates, fees and closing costs, and comparing available loans. A mortgage originator can perform those tasks for you.
What are the benefits of using a mortgage originator?
As mentioned above one of the biggest advantages to having an originator is personalized service. With retail banks, borrowers often endure long, stressful and occasionally fruitless meetings and conversations with a variety of different bank personnel in an institutional environment.
Your loan officer will also know who the best Realtors are in the area where you want to buy your house. Believe it or not, there are good Realtors and bad ones – and your loan officer will know both. In addition, your loan officer can give you “honest” advice about the differences between different parts of town. Since you know they aren’t trying to sell you in one direction or another, they can be a helpful resource of what the local “scene” is wherever you are looking to buy a house.
How to choose a mortgage originator
It is completely okay for you to interview prospective loan officers. If you had $100,000 to invest you would want someone who knew what they were doing. Well getting a good loan officer who can get you the best deal can save you thousands and thousands of dollars over the life of your loan.
Here are a few questions you could ask…
- How long have you been a loan officer? – Experience can be a big factor.
- How many loans are currently in your pipe? – You want to ask this because you want someone who is moderately busy working on your loan. If you get someone who has 0 or 1 loan in their pipe the danger is that they don’t have enough to keep them busy and may have distractions elsewhere. Too many loans may mean they are too busy and won’t have time for you. A good loan officer typically has about 2 -12 loans going. Within that range is doable.
- What is your origination? – A good loan officer deserves 2% – 2.5% on the loan. Typically that is divided between 1% on the front (origination) and 1% – 1.5% on the back (yield spread premium).
- What has been the average amount of days to close your last 10 loans? – Now this could vary greatly because of the many different scenarios and condition of banks which are lending the money. 30 days used to be pretty standard, but 45 days has become more normal. This is due to more guidelines and regulations that the lenders are requiring. On normal purchases and refinance it should be in the 25 – 45 day range. Short sales and other types of loans may take longer.
- How often will you contact me? – The best answer you could hear is, “How often do you want me to contact you?”
- Now the big test is asking them to follow up with you once or twice by email and once by phone after the meeting is over. You have not agreed to anything yet, you just want to see if they will indeed follow up. Give them precise times to contact you. Something like, “Can you follow up and email me Tomorrow Morning around 10am, and can you give me a call in 2 days at 3:30pm?”
- This will test their organization and ability to contact you when you ask.
If you’re looking for a dedicated mortgage originator in MD, DC, or PA, contact Lyn today!