As a broker, it’s your goal to get your clients the financing they need. However, there’s some work that needs to be done before you can seal the deal with a lender. Here are some tips for brokers on how to gather the information you need and present it to the lender in such a way that the mortgage lending process goes as smoothly as possible:
- Screen the deal well from the beginning. It’s important for brokers to get all of the information they need from borrowers early in the process. There are a couple of key elements every broker should request from the beginning. You’ll want to ask the borrower how much money they want and what they’re planning to do with it. You also need to get an idea of what kind of rate they’re looking for, their credit scores and history, and their income. It’s important to obtain all of this and not rush into a deal with incomplete information.
- Round up the documents. Once you’ve decided you’d like to proceed with this client’s project, you’ll need to collect some documents to put together a loan package. You’ll need to provide a lender with an executive summary (which should be a description of the transaction, the property and the borrower), an application (a 1003 or personal financial statement should suffice), and credit reports for any individuals involved in the deal. Photos of the property are always helpful. You should always ask each lender what documents will be required. A full package will help you get the deal done more quickly.
- Summarize the deal. No underwriter is a fan of sifting through a bunch of documents to try to understand a deal, so writing up a good summary is a great way to save time. Explain the particulars of the deal well, and the underwriter will need less time to review the request for financing. This will also benefit you in the long run because in order to summarize the deal well, you’ll really need to understand it. When questions come up, you’ll be better prepared to answer them.
- Receive the letter of interest. If the deal is a fit for one of the lenders you work with, and you’ve done a good job of presenting it, the lender will issue conditional approval, which means you should receive a letter of interest (LOI). The LOI will spell out the terms of the loan for the borrower and will explain any conditions they need to meet before the loan closes. Be sure to go through the LOI and familiarize yourself with the contents so that if any questions or problems arise, you are ready to handle them.
- Get paid. It’s that simple. If you’re working with a lender like APEX who handles all the details of underwriting, processing and closing the deal, your only job is to sell the loan. Once you’ve done that, all you need to do is wait for your check.
Learn more about working with APEX – What APEX Offers Brokers