Sunday, January 6, 2013

Why I Started This Blog...



I purchased my first home in 1992. I was in my mid to late 20's and still was figuring out what it meant to be a grown up. Needless to say, I was scared to death during the loan process. There were a lot of things to do, not to do, to consider and to discuss with my real estate agent. And the mortgage jargon was just as mysterious to me as understanding Mandarin Chinese. Points, DTI, LTV ?  What do these words mean ? Why are they important ? I have never been one to go along with the phrase "Just trust what I say, okay ? ". So I used to spend some evenings looking up all of the words used by the mortgage broker just so I could try to keep up.

Fast Forward to 2005. I am now a mortgage loan officer myself. The real estate industry is booming. People are purchasing and refinancing homes like crazy. But there is one disturbing trend I begin to notice. Borrowers still did not understand the mortgage loan process. It didn't matter if they were buying a home for the first time, or refinancing their second home. They were just as confused as I was 13 years ago when I was in the process of purchasing my home. Not that they were as paranoid as I was, mind you - but confused nonetheless.


Having noticed this, I began to calmly explain the loan process to my clients, forecasting the next move before it actually took place. This resulted in a win-win situation for both myself and my client. It made my job a lot easier, and it made a much happier and contented borrower throughout the transaction.

So, I began thinking to myself  "why does the general public not understand the mortgage process"?Well, I think that there are a couple of different answers to this question: 1) the industry doesn't want the public to know and 2)the public doesn't want to know either. Or maybe I should say, THEY DON'T CARE. At least not until they want to refinance their home or buy a new one.

I am not really sure why people don't understand how mortgages work. But I don't think it's fair. Now, I am not talking about understanding the origin of mortgage interest rates (but I will tackle this issue in another post, I promise). I am really talking about information a First Time Homebuyer should have prior to applying for a loan, so that he or she knows far in advance that they should not pay their current rent payments in cash, or why a person who wishes to refinance should not currently have their home listed for sale. This information is just not readily available to consumers. It's almost like you have to begin the process before you find out you have done something wrong. To me, that's nonsense...

Now - Let's imagine there is a place where consumers can go and read about the scenario they are currently in, and have a notion of what they need to do BEFORE they spend their time, resources or money trying to purchase or refinance a property. That is the intent of this blog. To empower those who need information, or a road map for what works and what doesn't. A general understanding, or a notion of how mortgage financing and the mortgage loan process actually works.

So, here is my stab at it. Enjoy...

2 comments:

  1. Thanks Butler. Hopefully the information on this blogs clears things up just a little for someone out there looking for mortgage financing. I know it sure is foggy out there now...

    ReplyDelete