The Lender-Trained Real Estate Agent is Top of Game

A top-producing real estate broker once said “the best agent in real estate is one who is lender-trained.”  As someone who previously managed all aspects of marketing and compliance for a mortgage firm, I had the benefit of working under the guidance of three different presidents of Oregon’s mortgage professional association and learned a great deal about how the relationships they built with industry partners made the collective work easier and produced a superior net goal for the client.

Many real estate agents will suggest to “stay in your wheelhouse.”  To me, that statement presents issues for prospective clients on a number of levels.  By no means do I advocate that the agent should be involved in the pre-approval process for a mortgage loan – but it is fundamental to the backbone of the real estate profession that we understand the nuances of critical tasks we entrust as referrals to a loan originator.  Here are some basic items that brokers in any market segment should understand:

1)     A footprint of the mortgage loan program landscape and how to get information from the client so a referral is beneficial for everyone (i.e. a private bank loan originator who may leverage certain appropriate products will have a completely different lens than one who specializes in reverse mortgage products etc.)

2)     Knowledge of how and where mortgage loans are qualified, processed, and closed.  If a real estate agent knows that a certain set of documents are needed for a solid pre-approval, they should arm their clients with the information to make the transaction successful from the beginning in addition to what tools and overrides are available to the mortgage company to obtain the desired result.  Penrith Home Loans (disclosure: owned by my company, Windermere) has remarkable access and flexibility to meet timelines and its leadership is as hands-on as local originators may need them to be.

3)     Overarching knowledge of financial markets and mortgage loans.  If a broker does not have a grasp on financial indicators, they have lost touch with being a touchstone and central figure of a transaction.  Maintaining thought leadership is part of the real estate broker’s role and that expectation increases as the level of sophistication of a transaction increases as well.

As a client, here is a fun test for your real estate professional.  You’ll know you’ve selected a leading real estate advisor if they know the following answers:

1)     How many members are there of the Federal Reserve Board and what are they called?
Answer: The seven members of the Federal Reserve Board are called Governors

2)    What is a tranche?
Answer: Tranches are segments created from a pool of securities—usually debt instruments such as bonds or mortgages—that are divided up by risk, time to maturity, or other characteristics in order to be marketable to different investors.

3)     How are mortgage interest rates determined?
Answer: The Federal Reserve, bond market, Secured Overnight Finance Rate, Constant Maturity Treasury and the health of the economy and inflation all affect mortgage rates.

4)     What economist has a real estate index named for him?
Answer: Yale Economist Robert Shiller.  The S&P CoreLogic Case-Shiller Home Price Indices are a group of indices that measure real estate or housing prices. They track changes in residential home prices throughout the United States.

5)     What bureau in the US Government supervises consumer finance regulation?
Answer: The CFPB was created to provide a single point of accountability for enforcing federal consumer financial laws and protecting consumers in the financial marketplace.

6)     BONUS: What company is America’s largest loan servicer?
Answer: Wells Fargo with a $962 billion portfolio.  The bank plans to reduce its servicing to concentrate more on bank customers and minority communities.  Loan servicing is described as the administrative aspects of a loan from the time the proceeds are dispersed to the borrower until the loan is paid off.

This quiz is part of assessing the overall fitness of the real estate professional to know macro finance influencers that contribute to stellar client relations experience and representation.  It's nice to be lender-trained.  Enjoy!

Truth in Title - The Anatomy of a Winning Title and Escrow Partnership

ADVISORY: This particular segment is longer than usual, but worth a read.  It is a date-stamped opinion from my recollections circa 2021 - it also reflects the amazing people, culture, and time of a  specific era of the company that has since changed.
Many clients and industry partners have asked “why are you such an ‘evangelist’ for your title partner?”  The answer is not because I previously worked for the company – but the all-around approach that encapsulates the client experience is what I fondly remember far before I ever worked there.  With that disclosure, here is simple reasoning as to why a choice in title insurance and escrow services is a fundamental capstone that rounds out the equation of solid client representation.

GREAT ESCROW
This is now a basic expectation within the transaction landscape.  Part of that service is accessibility and when and how an escrow officer is willing to interact with a real estate broker, lender, or client.  I’ve often noted that our collective share of escrow officers in Portland is smaller than the membership of our most exclusive private golf club, the Waverley.  This is true.  Within the escrow club is a much smaller set of truly gifted individuals who transcend that of masters of numbers and attention to detail and have the human touch where they weave the real estate broker into the conversation to make the client feel completely confident that they are surrounded by total competence.

INTERPRETIVE GUIDANCE
Each escrow company has what was formerly known as “customer service.”  Customers shop at a grocery store, but clients use the services of an escrow company.  Not all client services groups are created alike.  The best ones have a team of true data scientists who are able to help real estate brokers and lenders with special projects to find solutions to their business needs.  In some markets, the regulatory framework requires the broker to pay for information, but on many occasions data has been used to source hidden “product” to assist brokers in finding their clients a match.  Ask me sometime about a research project using a GIS specialist for locating the ideal zone for a client within a country club for an industry partner in another market.  Client services teams refine data to make it manageable and usable for a wide array of purposes and good ones succeed in matching those expectations.

EXCEPTIONAL TOOLS
Title companies are famous for repackaging data that is readily available to interpret via a variety of platforms.  However, there are standouts that every title client development officer (sales is so pedestrian) should have at their fingertips.  A solid rule-of-thumb is to master three tools – just as we advise new brokers to do with the barrage of product arrows that are hurled in their direction.  As these are almost always rebranded filters of like-information, choose the user interface that works in concert with your desired consumer client experience.

ACCESS
Your title company is neutral in many ways as it serves many masters.  That neutrality offers an incredible opportunity for them to act as a “connector” as relationships are free but take time to nurture and develop.  One such example is having an out-of-market expert on a certain client segment.  Upon learning that my former company had an expert on Asia-Pacific marketing, I invited her to the Portland market under the banner “Director – Insights and Analysis - Asia-Pacific, Global Markets Practice.”  In one day, she participated in a grueling schedule to bring her message to over 300 real estate professionals.  And, I was able to fulfill on my brand promise that I still use in my real estate practice today to “give them something they can’t get anywhere else.”

MARKET INTELLIGENCE
At my company, Windermere Realty Trust, we are blessed to have an in-house economist, best-of-class education on social media and other marketing tools, and the counsel of extraordinary wisdom in the comparative Ivy League quality team of managing principal brokers.  Title partners where C-suite personnel are visible and available for dialogue and sharing best practices are extremely valuable and create an environment which elevates the real estate profession as a whole.  Investigate how regional and national title company leadership are participating in growing and sustaining business of their local operations.  These individuals see hundreds of markets in action, and have incredible insight to macro trends and how they will affect the local marketplace.

OFFICE ENVIRONMENT
In a post-Covid world, nothing can replace human interaction.  This is especially true with something that has the gravitas of transferring large assets like property.  Clients are curious, nervous, excited and the emotional spectrum runs the gamut.  The goal of the escrow office is to reflect the market it serves and to assure the consumer that their transaction is in good hands.  We designed a 10-point plan that summarized the escrow experience from “introducing the transaction” to the closing and beyond.  Security, privacy, and a dash of relevant local artist works and furniture (in a private client setting) all contribute to the recipe of a positive client experience.

DON’T LET RESPA BITE YOU
Above all else – adhere to and beware of title partners who offer a pot of gold for your business.  In California, the environment is heavily regulated to ensure that companies are not buying business.  The reputation of the title company should be as such as a client feels the interaction is so natural that they expect the same experience in future transactions.  Intellectual capital and idea sharing are free, and that deep knowledge and close connection with the escrow team, client development officer, and local/regional/national leadership is all you need in your toolbox to be successful.  Local regulators have not been beneath asking for proof of payment for advertising and events, measuring size of ads proportionate to payment, other items that may seem easy to slide under the radar.  Therefore, short term benefit and bragging that the “title company will pay for this or that” is a sure sign of the suspect character of a real estate broker and the financial fine, professional reprimand, and damage to reputation is not worth the risk.

AND FINALLY – COMPANY REPUTATION AND FINANCIAL STRENGTH
I’ll admit, my former employer is the highest ranking Fortune 500 title insurance company.  While that is a benefit, this company takes its business very seriously and pays out “losses” if they are incurred to the consumer with precision accuracy.  This cannot be said for all companies in this sphere.  In recent times, a new title player emerged that was funded by a private equity firm (the investment exit strategy for these types of companies is always acquisition) and therefore the interest is not with the industry partner or public’s trust, but with acquisition in mind fueled by a take-no-prisoners ravenous mentality.  Loss reserves of public companies are well-documented and while losses are infrequent, public companies can back up their title insurance commitments and claims.  Selecting a title insurance company with documented reserves and a rich history is as much a benefit to the client as it is to the real estate professional.  An incorrect title vendor decision and an unpaid or heavily disputed loss will cloud a real estate broker and is a concept of reputation management that we collectively never truly analyze.  Thinking long-term is a necessity with any vendor selection and most of mine have been with me for my entire time in the real estate sphere.

If you haven’t already guessed by now, my example of stellar performance in escrow services and title insurance was of Fidelity National Title and their market leading teams in client, development, and escrow services.  My 20-year relationship with the company on both the inside (as VP Corporate Relations) and the outside (both before and after as client) reflects on a very special place in time when FNT Portland’s Jeff Meucci was the undisputed visionary as the company’s sales organization leader prior to his promotion within the operation.  May we only have more thought leaders like him within our market and throughout the industry.