Are you a real buyer?

One of the many points I will try to address through this blog is that buyers should only be working with a lender they can trust.  However, trust is a two way street and must also be earned by the client.  A question that all house hunters should be asking themselves is  “Am I a real buyer”?

What I mean by a ‘real buyer’ is as follows.  Are you the type of buyer who is going to find a local real estate agent to work with, apply for a loan,  and also get your lender all the documentation they need up front in order to get a loan approval?  Are you the type of buyer who is going to actually make an offer if you find a property you love?  Furthermore, are you going to be committed to that deal and work towards closing escrow?

For reasons I have yet to precisely identify, people like shopping for houses without any intention of actually buying a property.  This leads them to shop for a loan which they have no intention of ever obtaining.  All this work combines to create a sluggish, and even overwhelmed real estate buying process.  This bogged down system penalizes those buyers who are serious about home ownership. 

To be clear, there is absolutely nothing wrong with doing some fact finding, discussing option with your real-estate or financial professional, and/or visiting open houses to get a taste of what your personal style is.

However, it’s important to know what your real goals are… and to pass this information on to those who are helping you through the process.

I’m sure there are many reasons why people who aren’t real buyers seek out real estate or mortgage specialists to help them through this fake transaction.  Maybe it’s about the client who wants to share in the American dream of home ownership but isn’t ready yet, either financially or emotionally.

Maybe it’s the desire to look at houses that are visually or architecturally appealing as a hobby.

It could be a client who knows they will never be able to pull the trigger on a purchase, but who feels that right now there are deals in the real estate markets… they just want to be part of the action.

In some sad way it maybe it is a sense of self gratification one gets from walking through a house that has lost 20% of it’s value and saying  “not me, I didn’t fall for this last real estate bubble”.

Maybe it’s a case of people thinking they can bite off more than they can chew.  Everyone, myself included, loves to look at the million dollar houses, when they know they can really only afford the $400K house across town.

For all these reasons, and hundreds of others I can’t think of, it’s important for lenders, real estate agents, and clients to have a serious talk  about this topic… are you a real buyer?

Underwriting departments at banks right now are slammed with millions of files for loan pre-qualifications.  In my estimation, half of these files aren’t what I call ‘real deals‘.

Real deals are loan files that have the legitimate potential to turn into purchase contracts, and then closed property transactions.

Time and again I see real estate agents, lenders, and support staff spend countless hours on deals that will never come to fruition.  No doubt real estate is a fickle industry right now.  Deals fall apart, escrows get canceled, and stuff happens… but building a team around a ‘real buyer’ is key to doing business and helping those individuals who actually want to be a home-owner.

As always, if you need information on starting a new loan for the purchase or refinance of your home, contact me at  TrustYourLender@gmail.com