“It’s not just about the deal itself at the point of origination,” Offutt said. “You can have bad docs, whatever. Ongoing performance is also important. Any broker or lender, it’s not just about firing and forgetting when it comes to doing a deal. You need to stay on top of your clients and stay in contact with them.
“You could be 12 months, 18 months down the road from having done a deal. That borrower could go south, and you know that could also reflect poorly.”
Hornik agreed that ensuring past customers follow through on their mortgages is vital to ensure that the lender will want to do business with them in the future.
“It’s not just when they close the loan and you guys fund it,” Hornik said. “It’s the performance over a lifetime. You may think you’re done with something for two years, and you may get a call back going, ‘Hey, do you know what’s going on with this borrower?’ And you’ll be like, ‘What are you talking about? I sold it two years ago.’ I’m done with that deal, but (the lender) is not done with it, which means you’re not done with it.”
He noted that some of the issues could be related to the way the loan was underwritten, but it could also be someone trying to defraud the lender.