Is $10,000 too much for a lender to make on your loan?
In a recent posting I took a Reno, Nevada loan officer to task for making over $10,000 on my friends loan. I said, “The real shame is what the loan officer was trying to make on this transaction, almost $10,000. These borrowers have good credit, just needed a non standard loan, one hard to shop and compare for rates. CLICK HERE FOR THE FULL ARTICLE.
November 1st a loan officer who identified himself as Larry Harold, took issue with my article. He said, “… in regards to your comment on the mortgage consultant making $10,000 on a loan is too much. Well first off, who are you to decide that, and secondly you are pointing fingers at the wrong people. I have seen realtors take over $30,000 in equity for simply showing it. Usually they don’t do much work and defintely don’t do more work and take on less risk than loan officers. So logically loan officers should get paid more than real estate agents, but that is not the fact. Also, let it be known that with out loan officers there would be no loans, people could not buy house, they could not cosolidate high cost debt, and real estate agents would not have any income either.”
As I invite your comments on this article, which I do, I also use this comment to point out the reasons for this website. We started with MortgagesUndressed.com as a consumer service to expose and make transparent the mortgage business.
This is an example of what I mean, a good one. The person who made this comment did so of his own will and choice. I sensed some passion in what he wrote, I am sure he is sincere. He even seemed angry with me in a how dare I tone. He posted a name, probably a real one. He left me his email address. What more open and public disclosure forum could there be? The only thing to accomplish that would be better would be to have every US citizen find this debate.
This article and comment will be in this blog as long as it is live. His name and comments are in the blogoshpere for all doing research to find. It gives the consumer a way to arm themselves with knowledge. If Larry Harold is his real name he has courage and guts. He layed out his position. Now it’s part of the marketplace as well as my comments, and yours if you add them. I Love this forum.
Debate it is, here goes.
To the commentor, Larry Harold. I respond by telling you I don’t believe you tell the consumer you will charge them $10,000 or more. I believe you hide the numbers. I don’t believe you can prove to me with a Final HUD 1 closing statement from an actually Escrow closing you did this and were up front with it.
I believe you did one of or a combination of these things: you charged a loan origination fee; you improperly added a loan discount fee to a real discount fee, you could have earned a rebate the customer couldn’t clearly see, you would have added your junk fees and given the borrower psycho babble as to what they were, and finally you may have worked for a bank or mortgage bank that earned money not disclosed on the HUD 1.
If you tell the consumer you are going to charge them $10,000 or more, fine, take your gamble with the competiton. The industries problem is how easily the consumer is duped and not informed.
PROVE ME WRONG LARRY HAROLD SHOW ME THE HUD! I DARE YOU AND DON’T BELIEVE YOU WILL!
PS: Is your name really Larry Harold? If so, you should start a blog and write your opinions and defend your positions. You should advertise the blog to all you do business with. Give them access to your heart, mind, beliefs, opinions, and knowledge.
Well to start Larry, you can believe whatever you want. The majority of loan officers do not hide numbers. The majority of loan officers don’t deviate from the initial good faith “ESTIMATE”, and also inform their clients of every change that has been made. If they don’t then it is illegal. Also lets take note of the fact that noone is forced to sign anything. Everyone that closes a loan does it on their own free will. A person has 100% right to walk away from the table and for refinances has a 3day rescission period.
All this talk about the fees, well all I have to say is are you a lender Larry? Do you know the risk the lender is taking on? Are you willing to lend someone with an imperfect payment history money, when there is a good chance they will either default on their loan or pay you late? If so I suggest you start your own Bank.
There are alot good programs available for people that will not cost them near that $10,000. This case was extreme I was just pointing out the fact that you were using this one example of millions to represent the whole, which is inaccurate and un-credible.
I will however revise my statement that realtors don’t do much work, because I know it is a stressful job. However They do make a considerable amount more than loan officers, and I do think the are overpaid a little.
I would be willing to bet that if we looked at the stats, which I admit I don’t know, I would guess it to be three times as much.
Now its funny that you talk like I was the one who did the loan for your friend, which is not the case. I understand its a desperate attempt to get feedback.
If your going to make accuasations about an industry Larry please have some sort of statistical analysis to back it up, otherwise it has no credibility, and I have just waisted 5 minutes of my time on even commenting on this whole thing.
Larry, you are a bold fellow. I know what I am talking about. Take some time to read about me. I come from both Realtor, Loan Officer, and Mortgage background; totalling over 30 years in the business. I have worked as an in house lender for a major real estate company, have been an L O in an office of 300, and have employed 100 loan officers doing 300 loans a month.
I do have a response to your response, but will wait until monday. Stay tuned, I can still get you. Lar
Well Larry, Its not about winning and loosing. I guess my main reason for even making a post is because I am sick of all the negativism out there about the industry. There are far more good loan officers/consultants in the industry then their are bad like the one in the article. Its just that when a transaction goes bad its someone’s life that is getting affected, and so that one transaction is amplified to make it seem like it happens with all house purchases, etc.
Either way, the response was a quick vent of frustration about people focusing on the bad things. I do like this website, and I apologize if I was harsh.
There are bad apples in all industries, and that is why I think it is important to get to know who it is your dealing with before you go forward. It is your website and I will let you have the last word. This will be my last post as I can’t spend anymore time on this. Good luck, and thanks for the feedback.
Thanks Larry, I share your concern. Thank you for participating. Understand the reason for the article is because of the focus of this website/blog. It is written for the consumer. I know the loan process is complicated enough that most consumers are vulnerable. I am hoping we, including you, educate them here and on other blogs. I had maybe 3 to 6 bad apples out of 100, but boy did they do damage, quick and sure. It is the minority that ruin the business. I also know that people shop on line, dream, for months and months before they buy. I want them studying mortgages while they dream.
I do undress things, but I try to make it balanced with a mix. If you have other suggestions, let me know.
I enjoyed our interplay, will still respond Monday. Lar
I am one of those over paid real estate agents. Here in MN many of the loan officers get a small salary + comission. I work on 100% comission which is not for wimps. I spend about $500 or more on each home I market before the for sale sign goes up. It costs me a small fortune to generate leads. When I do get paid I have to split that comission with others. As for risk, guess who gets sued if a buyer a buyer has a problem with the home they purchased? I don’t care how much money a lender makes, don’t care how much money the guy across the street makes either. Not my problem, don’t understand why people care how much I make and how I do it. All of my sellers get a list of all the fee’s they will incure, including my comission. I love my job!
Thank you Teresa. So you with a Monday Article on this. Lar