Lenders Should Demand an Honest Appraisal

Because it’s just good business.

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I love working with lenders that can see beyond the deal right in front of them. They are not bound up with making today's buck. Instead they are looking to the future and trying to build a thriving business. If all of us in the real estate industry would have thought long term, we wouldn’t be in the mess we’re in.

It’s a mess out there

The real estate, mortgage, and appraisal industry is a mess. Check out a few recent headlines:

Colorado Federal Housing Fraud Snares Eight
Colorado Indicts Man in Mortgage-Backed Securities Fraud Scheme
Colorado Loan Officer Sentenced in HUD Fraud
Colorado Mortgage Prosecution Results in Four Guilty Pleas

The people involved in these activities certainly haven’t built successful businesses. Even worse, these kinds of actions have led to distrust of the entire home loan process. The Mortgage Fraud Blog notes that, “Mortgage Fraud is the fastest growing white collar crime in the United States.” That is not what we want our industry to be known for.

In the current market climate, with headlines of fraud and mismanagement hitting the headlines daily, it is important that you build trust with your customers. So, how do you build trust?

Seeing the forest through the trees

I love is working with lending professionals who see the forest through the trees. Lenders who see beyond the deal right in front of them to a business model that concentrates on building relationships that last through years of refinances and new purchases.

According to Barry Farber in a recent article in Entrepreneur.com, truth and reliability are two of the most important factors in building trust with clients.

We in the real estate industry need to look beyond any given hot housing market and beyond any temporary downturn and build clients for life. The best way to do that is to build long term relationships based on trust. Trust between client and professional, trust that the professional has the best interests of the client at heart.

Perhaps David Porter of Mortgage Broker Coaching, LLC. sums it up best when he states, "Remember that in your mortgage practice that there is a product (the mortgage) and a process (how your client's feel). The "process" is a critical piece. If your clients are not saying WOW, a lot, then the likelihood of their ongoing referrals is slim."

Protect yourself by demanding an honest appraisal

Whether you are a mortgage broker or direct lender one of the best ways to protect yourself, your reputation, and ultimately your bottom line is to demand that an appraiser honestly and independently value a house for lending purposes.

An appraisal is part of the risk mitigation process that insures that you (the lender) have sufficient collateral for a loan. But it can also be used as a trust building tool with your clients. Tell your clients that you have hired the best, most honest and most independent appraiser to make sure that the loan they are getting based on a house value is good for them today and tomorrow. We can’t push the value of homes up artificially not just because it is wrong, but because it weakens the entire industry and hurts our business.

This brings us to Above Board Appraisals. I will do everything I can to honestly value houses, earn your trust, and help you gain clients for a lifetime.

Contact me so I can begin to build trust with you and help you build trust with your clients.

Additional Materials

The Trust Factor

10 Ways to Build Trust!

Relevant Documents

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