Lending executive shares tips for brokers
For independent mortgage brokers, the process of finding a good lending partner is critical to long-term success. Once a broker finds a good lender, they want to foster that relationship for future mortgage loans.
This is especially true in the non-QM and investor space, as brokers often get repeat borrowers looking for investment properties. Finding the right lender to work with either high-dollar-value or complicated loans is essential.
A partnership that isn’t strong makes life difficult for all parties. Brokers and customers are worried loans may be denied, while lenders worry that the files they’re getting might not represent the whole picture.
For one lending executive, the process of building a strong relationship with mortgage brokers is one that he hopes will benefit everyone in the long run.
Michael Fuller (pictured top), vice president of wholesale at Constructive Capital, said the best broker/lender relationships end up as a strong partnership.
“We only work through brokers, and we build them up to be good partners of ours,” Fuller told Mortgage Professional America. “So we're really walking down the lane together to the point that we even co-market with some of them. We want to see them grow, because a good broker experience just brings in good business.”
Brokers are the ‘gatekeepers’
One of the ways that brokers build up goodwill with lenders is to make sure the files they are sending make sense. Fuller said the brokers who take a little extra care up front are the ones who make the best partners.
“The good brokers are the ones who realize that they are the gatekeepers,” Fuller said. “It's up to them to scrub files, to check that the title is accurate, to look at an appraisal and see that it says ‘subject to,’ but they need to have it say, ‘as is.’ They need to make sure that if a guy's buying a $500,000 property, don't give me one account that has $1,000 in it.”
The difference for lenders when building broker partnerships is to find the ones that get the little things right on a consistent basis.
“When you consistently get it all right, when you consistently adhere to our guidelines in terms of getting all the documents in correctly the first time, loans just go smoother,” Fuller said. “Human nature is, they'll see a loan coming from a certain broker who's giving us 10, 20, 30 loans a month and really checking off the right boxes and making sure the loans are clean. I'd be like, ‘I can't wait to work on this one. I know it's going to go through smoothly.’
“As opposed to some other brokers who aren't quite as efficient. It doesn't mean they're bad brokers. It just means they're not as thorough. But the better ones, they learn. And most of the brokers, over time, just learn to get better.”
Bumpy to smooth
Anytime a broker starts to work with a new lender, especially a non-QM lender that might have a unique process, the first few loans can be a little more complicated, Fuller said.
“I tell every broker that signs up with us, the first loan or two you put in, it's going to be bumpy,” he said. “You're not used to our process yet. But after a few, they're like, ‘This is pretty smooth.’ I've had quite a few brokers say, ‘Look, we just love working with you guys, because your process makes sense. We know, as long as we follow your guidelines and the loans we're sending into you adhere to your guidelines, we know they're going to close, unless something really wonky comes up.’”
On the other hand, if there are issues with a file or if documents aren’t quite right, it causes underwriters to have to get into the files over and over, which delays the process for everyone.
“It's a time suck if the same underwriter has to go into the same file over and over again,” Fuller said. “Time is money. We’re going through anywhere from 700 to 1,000 loans a month here, and while we have an excellent staff, time is money. We don't want our openers, our processors, our underwriters, having to touch a loan multiple times. The fewer touches there are, the more efficient the system is.”
Fuller said that as brokers get files put into the system, account executives (AEs) can see what’s been uploaded already and provide assistance on what might still be needed. It allows the partnership to be a two-way street, allowing for more efficient loan processing.
“We can actually look into the portal from our end, so we can see what's in the pipeline,” he said. “We can see what they're building. And you know, some of the better AEs will actually open them up and say, ‘Hey, I see you’re still missing this. What's the time frame? Can I help you out? What guidance do you need?’ It's that kind of partnership that leads to max efficiency.”
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This article is part of our Monthly Spotlight series, which in March focuses on broker/lender relationships. Full coverage can be found here.
