Today I was looking for some information on mortgage advisory groups just to see what’s out there. So I typed that group of words into my search engine and got nothing but real estate companies. REALLY! Since when do real estate agents know anything about mortgages? Sure they know that mortgage is spelled with a “t”, but beyond that I’m not sure what they know.
OK, to be fair, there are some well-educated, experienced real estate agents in the country and if you are lucky enough to find one they can be a big help throughout the process. Unfortunately, I have experienced way too many that fail to meet that criteria. For example, there was the real estate agent who was involved in the purchase of my current residence. Once we had found the house, she advised that we needed to look for a mortgage company and then suggested that she knew a loan officer who could work with us. When I purposely asked what we needed to do she advised that we “shouldn’t worry; the LO would fill out all the paperwork and all we would have to do was sign at closing.” REALLY! When I asked that a clause we inserted into the contract that required the property to appraise at the selling price or greater, the selling agent advised that she “can make sure that the appraisal comes in at price.” Of course she could! This was after we had negotiated the sales price of the house down the extra $100,000 the selling agent had listed it for. I had obtained numerous comps and knew what the value actually was. The seller was shocked that our offer was so low when the sales agent had listed it for so high. REALLY! Of course when the comps showed the true value she had no option but to advise her client to take our offer. No wonder housing prices escalated so much. Then when I said I wanted to finance it with an 80-10-10 loan they both looked perplexed. I had to explain what I meant. And these are the people listed as mortgage advisors. REALLY!
To be fair, that was a while ago, so I had hoped that they had learned their lesson and were more knowledgeable about mortgages and the new regulations so that they really could at least assist their current clients. Unfortunately that hope was dashed when I was talking to several agents and asked them how TRID was going to impact their business. The response I got was less than what I had hoped for. They readily confessed that they didn’t know much about TRID and what was involved. While they were aware and concerned that it may hold up closing, they had no idea why. Neither did they fully understand that there would be very different disclosures, what the limitation on fees were, and that there would be a very different Closing Disclosure. Their only question was “how can we get this waived?” REALLY! It wouldn’t surprise me if this problem was the impetus behind the TRID delay.
After all this industry has been through and all the regulations, examinations and scrutiny we are subject to, I have one question that has yet to be answered. Why are there no controls, requirements or limitations on Realtors? Where are the prohibitions against calling yourself a “mortgage advisor” when you have no idea what is required? And where is the CFPB? Aren’t they supposed to protect consumers? It sure seems liked they missed the boat on this one. Really!
About The Author
rjbWalzak Consulting, Inc. was founded and is led by Rebecca Walzak, a leader in operational risk management programs in all areas of the consumer lending industry. In addition to consulting experience in mortgage banking, student lending and other types of consumer lending, she has hands on practical experience in these organizations as well as having held numerous positions from top to bottom of the consumer lending industry over the past 25 years.