Good morning all: Up here in the great Northwest, it's Fall. Today is cloudy and cool and we've had quite a bit of rain this week.
I've been meaning to write this blog for some time because I think its important. The question is how tranparent are you? The reason this came to mind is I recently had to tell a client exactly how I got paid. Granted, I've always done this but, still, most clients don't understand or pay attention.
In my case, I was working on a huge loan and had tried to submit to an East Coast bank (big mistake) who didn't understand my client's income as much of it was in the form of bonuses. After that loan submission failed, we were scrambling as we had to pick a new lender with a higher rate and not much time to close. Needless to say, everyone was a little stressed.
I had to call my client and explain how not only was the rate higher but also how I got paid. In the first deal with the East Coast bank, I was being paid yield spread premium and wasn't charging my client any origination fee. When I submitted the loan to the second local bank, not only was the rate higher but I had to pay .25 and charge an origination fee. In the meantime, my client had gone to Lending Tree and gotten a quote for a no fee mortgage. I requested the Good Faith Estimate and saw that the competing lender had unnecessary junk fees in the loan and a slightly higher rate.
When I called my client, I levelled with him about how I got paid. I'm not sure how happy he was about the change but hope he appreciated my candor and transparency. The bottom line is we got a loan approval yesterday and it appears we will close on time. My client will be happy as they're realizing buying their dream house. I also learned something about going with the lowest rate projected. Most of the time, the lender either won't approve the loan or they can't honor that rate. How transparent is that?
In the three and a half years I've been in this business, I've seen so much. One of the things I didn't like was working with people who were in it just for the money. They weren't transparent at all in my opinion. So that should be everyone's goal; To tell it like it is. We all have our warts. But one way to build a great business is to be as upfront and honest as we can. If not, I'm not sure we belong! Thanks for reading. I invite you to share your stories about how transparent you are in your business. Have a great day!