“Less than 3% of people are close to upside down, if that. So, they’re not going to be the foreclosures. They will sell if they have to get out.”
Alberico said advising is especially needed when getting borrowers to consider refinancing to pay off high-interest debt. Some borrowers are leery of doing so because they know it could reset their mortgage to 30 years again.
“Loan officers need to coach their clients if their payments on the mortgage are going up,” Alberico said. “But overall, payments are going down by $900, and they’re worried? Okay, split the difference. You were obviously making those payments, because if you had a bunch of late payments, we can’t finance you. If you’re saving $900, put an extra $450 a month towards your principal. And then you don’t have a 30-year loan, you’ve got a 15-year loan. Then if rates come down, refi again.”
Keeping up with the mega-lender
Conrad noted that many large lenders and realtors have pivoted into a more advisory role to stay in mind with future customers when market conditions improve.
“The mega lender, the mega realtor, that pivoted, that adjusted, and that’s now spending more time coaching and giving true advice, versus just being an order taker,” Conrad said. “I believe that we’re adjusting our conversations, our time spent with a client is through the roof, but we’re also closing a lot of loans. We’re helping a lot of people. We’re giving them great deals.