Have current mortgage market conditions made you want to pull out your hair and scream? While the negative consequences of this fallout are real and painful, as a mortgage broker or loan officer there are positive actions you can take right now to improve your situation. And there are lessons all of us can learn to prepare us for the future.
What can you do right now?
1. Be careful of lenders who discount rates. Ask yourself — “Why is this lender so hungry for my business?” The lenders who are instable and less likely to be around tomorrow are also the ones most likely to discount.
2. Remain educated in what loan products are available and what scenarios they are best for. With the constant changes in the marketplace today, this means putting in extra time, but knowing what’s out there may mean the difference between closing a loan and not closing it. Ask your lenders for training on their loan programs. They should also have product guidelines available for your use.
3. Become conscious of your attitude and self-talk. There are things we can change and things we cannot. Being pessimistic and gloomy does not improve the things we cannot change. On the other hand, positive self-talk and a hopeful, happy attitude can improve a situation. First of all, you’ll feel better. Secondly, you’ll have less stress, which means your mind will be clearer and you’re likely to make better decisions. Third, your positive attitude will be apparent to your clients. If you were a borrower, would you rather do business with someone who is optimistic or pessimistic?
How can you get ready for the future?
1. Stay out of personal debt and keep business debt to a minimum. Pay off your house as quickly as possible. Purchase a car you can afford. Spend less than you make. You’ve heard it before, and there’s a reason — because it’s good counsel.
2. Build up a financial reserve. Having money saved up for emergencies both in your personal life and in your business brings peace of mind, helps you weather the storms, and gives you a better chance of surviving and making decisions based on the long-term consequences.
3. Make choices based on a long-term perspective. This may mean working harder now for future profits. It definitely means keeping your integrity at all times, helping borrowers get the best loan product at the best rate (even if it means a lower yield for you ), and maintaining good relationships with your best lenders. Focus on building a good reputation and the investment will deliver great dividends.
In summary, look for quality lenders, stay educated on the market, and keep a positive attitude; keep debt at a minimum, create an emergency (or opportunity) fund, and make decisions based on long-term consequences. Following these steps can protect you against difficult times in the future and help you weather today’s storm.