5 Questions To Ask A Loan Officer Before You Hire Them

5 Questions To Ask A Loan Officer Before You Hire Them by Justin McHood

Got Mortgage Questions? Just Ask Justin

One of the most common phrases I hear from small business owners is “Good help is hard to find”. When buying a home, put on your small business owner “hat” and spend a little extra time searching for “good help”.

When looking for help in getting a mortgage loan, be sure to interview multiple loan officers, don’t just go with the first one you talk with! If you talk to more than one, you usually will find one that just seems to be “right” for the job. Finding the “right” loan officer can possibly save you money, but almost certainly will save you time and effort in the qualification process.

Here are 5 simple questions that you can ask loan officers when interviewing them:

How many loans have you closed that are for people in my situation?

In the answer for this question, look for a specific number and listen to the *types* of loans that he has experience in. Refinance transactions are different than purchase transactions. Conventional loans are different than FHA loans. To increase the chance that your loan officer will be able to handle your loan smoothly, look for how many similar loans he has personally closed.

Are you a mortgage broker or a mortgage banker?

There are pros and cons for consumers when working with each type. Mortgage brokers often blame the lenders underwriters because they don’t have direct control of the underwriting department. Mortgage bankers often have slower turn times and don’t do as many different types of loans. Neither one is necessarily bad – but it is good to know what you are dealing with up front.

Can you walk me through the steps of the loan process?

A good loan officer should be able to detail out each step of the loan process and give you a good idea of the time frames for each step that you can expect. Pay particular attention to the time frames the loan officer gives because this is where they set your first expectations. If they say that they can get a loan closed in 10 days in this market… be careful. I am not saying that it can’t be done, but that is a sign that the loan officer likes to over-promise and under-deliver.

What problems can you see potentially arising in my situation?

A good loan officer should be able to give you at least 3 things to watch out for in your situation. Even if you have perfect credit and millions of dollars – there are still things that could potentially slow your loan down in the process and a good loan officer knows where the potential problems are for your situation.

Do you offer a float-down option?

Note: this is particularly important when interest rates are falling. A float down option is where after you have locked your loan, if rates go lower, they can “float down” the rate for you at no charge. Few mortgage professionals offer this option, but this is a question that you should ask up front.

If you ask these 5 questions during your first interview of a loan officer, you have a much better chance of “finding good help”. And in an age where “good help is hard to find” according to all of the small business owners I speak with, it will be well worth your up-front investment.

Wait.

Did you notice that one of the questions is not “how much do you charge and what are your rates like?” No, I didn’t forget it. All of the great loan officers will probably talk about that before you even get a chance to ask the question.

Guest Contributors, Justin and Tammy McHood, are nationally published loan officers who work right here in Arizona. Read more of their mortgage-related writings at www.ArizonaMortgageTeam.com.