Relationships in Lending
Another week down with the InterContinental Group calls and I am left surprised as usual. This time I’m surprised about how many consumers find a lender. When asked, most of the consumers I spoke with said they found us or another lender through a referral from the realtor they were working with. Then I would ask if they ever did any online research into other banks or at least a little more research into the company the realtor referred. Surprisingly, most of the people I spoke with did not look for other lenders nor review the company they were referred. Most said they had enough trust in their realtor and didn’t think their realtor would refer them to a bad lender.
The connection that a realtor shares with a consumer is very strong. Realtors and consumers spend so much time together looking at houses and sharing bits of information about themselves and their likes and dislikes. Realtors build a strong connection with potential buyers that by the time buyers are ready to look for financing, buyers are so trusting of their realtor. And of course, realtors deal with lenders so often and go through the process every single day so of course buyers would view them as experts.
Buyers often feel that the local lender the realtor recommends understands the uniqueness to the area that they are looking to buy in. For instance, maybe the lender is aware that they need flood insurance in that area and can direct them to the best local insurance agencies that will get the buyer insurance fast. Also, the lender won’t unexpectedly request flood insurance a few days before closing and delay the process. Another reason some consumers said they went with the local lender was that the lender is clearly going to want to stay in good graces with the realtor so they get more future referrals. This means the lender will do everything to ensure the loan closes and everything runs smoothly. It’s things like this that make buyer’s more comfortable going with the local lender the real estate agent suggests.
I spoke with a lot of consumers that spoke to this point which really surprised me. We are in the day and age where everything is managed online and consumers will double check yelp reviews before they spend ten dollars on a meal. The fact that not many looked at the lender website, competitor websites, or even considered reviews of lenders or other competitor reviews at the very least is pretty crazy.
So this was my big realization this week… I feel as if every week there’s a theme of problems or realizations I keep learning about. Of course, I’m still trying to sort through my take away of each of the problems and what that means for the state of our industry. My mission, as many of you know, is to completely change the climate of the industry and how the process is working. All the input so far has been amazing and every week has produced such great insight. I can’t wait to see what next week has in store for me!