For the past two weeks, HousingWire took a deep dive into the effects an accelerated market can have on appraisal turn times and the delta between appraisal ratings and market forecasts. This week, industry experts discuss how to navigate client and referral partner expectations and minimize closing times when factors like these begin to decelerate the buying process.
Across the board, experts were in agreement that proactivity is key to avoid overpromising and under delivering. With many lenders seeing closings pushed out past 30, 45 and even 120 days, setting the expectation early gives lenders the opportunity to foster relationships with their clients and prepare for possible file extensions, said Mark Canale, senior loan officer and producing branch manager at Movement Mortgage.
“As an LO, you have to understand every aspect of the transaction. I get it, the seller needs to move, but doing a quick closing to incentivize the seller to accept your offer is no longer a selling point. You can’t say to a them, ‘Hey, we can close faster pick our offer,’” Canale said. “You need to have the confidence to say no, don’t fall into a tendency to say yes.”
But slowdowns aren’t always avoidable, especially on difficult properties and complicated buyers. Courtney Poulos, owner and broker of ACME Real Estate, said hiccups can occur anywhere along the process – from long wait times for liquidation of funds, to drive-by appraisals that were never intended to be drive-by, and underwriting staff being stretched thin in the wake of COVID-19.
“You’ve got to realize that for companies, many of their workforces are working from home, and getting verification of employment or last minute employment confirmations can delay your process. Appraisals are of course going to be delayed, and then that can delay title orders, obviously. It’s a bundle, a domino effect, and it’s understandable that people can’t get it all done in the same timeframe that they used to,” said Tawn Kelley, executive vice president of Taylor Morrison Home Corporations.
To mitigate these problems, lenders have to be willing to leverage technology that helps with automation but doesn’t remove the humanistic element of lending, Kelley said.
Automation opportunities and leveraging lead data are a start, but experts said creating internal tech adoptions that are operational by everyone on a team is what creates consistency that borrowers will notices
Poulos warns though that while tech-like automation can leverage incredible opportunities, the relationship element of lending cannot fall to the wayside. Personal branding, excellent customer support and friendly check-ins help clients feel engaged and increase their willingness to be flexible in the process.
For all experts, communication across every step of the way was the key player to navigating closing times. Setting standards up front can fall flat farther down the line if agents, underwriters, appraisers and everyone in between isn’t on board with the goal.
“I’ll be brutally honest. The trickle-down effect is just too much, your processer is going to hate you, your system is going to hate you, your underwriter is going to hate you if you set everyone up for failure,” Canale said. “I want to make sure that if I need an extension, I have a laundry list of emails, text messages and phone calls to that borrower to say this weekend we tried to make it happen. Honesty doesn’t ruin relationships. Promising something you can’t deliver on will.”