How do you buy a house?
Last month we went over the first step of buying a home, Saving a Downpayment. The next step is to Enlist a Team of Experts.
‘If you think it’s expensive to hire an expert,
try hiring an amateur.’
– Red Adair
The great thing about hiring a REALTOR® and a lender to work for you is there is no out of pocket cost, yet they will save you thousands of dollars and make the process much simpler. Tons of value. Successful people enlist the support and expertise of those who have specialized knowledge in a given area, rather than attempt to do it themselves and learn by doing.
First, hire a great REALTOR®.
Some questions to ask a potential REALTOR® are:
- What makes you different than other agents?
- Do you work as a solo agent or with a team?
- What can I expect from you during the home buying process?
- What is your level of expertise and education?
- Who is your ideal client? What would you expect from me as a client?
Plan to sign a representation agreement with your agent. Not only is it fair for a good agent to operate under an agency contract, it also gives you the most protection and representation possible. Without a signed buyer representation agreement, an agent could technically be working in the best interest of a seller even if the seller is represented by a different agent or brokerage.
Second, hire a great Lender.
The best source to find a Lender is your first hire: your REALTOR®. Most likely, your rock star agent knows a good lender they can recommend to you.
DON’T hire a lender based on:
- A referral from your large bank to their mortgage department. While those banks may be great at handling your checking account, their ‘mortgage departments’ are huge call centers staffed to take your information, enter data and then send your file into a sweat shop of overworked, underpaid wage workers.
- Who says interest rates are lowest. Rates change daily. And rates for one borrower will be different than rates for another borrower based on credit score, credit history, income, debts, job status, etc.
- Who sounds cheapest. There are a few areas in life and business where cheap is good. And many areas where cheap is bad. And ‘cheap’ mortgages can definitely be bad. If a company has the lowest rates, they also have too many loans to process each month with the staff they have in place, a lack of knowledge and expertise to handle unique or complex loan situations, and too little of a value proposition on service and communication. The single most important factor in selecting a lender is service. Service shows up in communication, expertise, and advice.
Some questions to ask a potential lender:
- What makes you better than others? Why should I work with you?
- How much are your fees (other than interest rates) ?
- If there is a problem, who is your support network, both up and down the internal channel?
- What percentage of your loans close on time?
- What do you need from me, in order to do your job as well as possible?
How do you thank your team ?
If your REALTOR and Lender do a good job for you, you may want to do something nice to say thanks. What is appropriate? The biggest compliment you can pay to your Team of Experts is to refer friends, co-workers, and others who need the same great service you experienced.