When it comes to recommending a lender for a home purchase transaction, a new study shows that closing time, reliability and costs are among the most significant factors for real estate agents.
The Campbell Surveys and Inside Mortgage Finance study revealed that real estate agents control or influence as much as 45% of homebuyer decisions on lender choice.
"Real estate agents consistently tell us that the unpredictability of mortgage closing dates is a major problem, in addition to timelines longer than 30 days," commented Thomas Popik, research director for Campbell Surveys.
According to Popik, lenders like to blame appraisers for delays, but the survey results tell lenders that underwriters often cause delays, particularly when underwriters do piecemeal and last minute requests for borrower documentation.
Two-thirds of the nearly 2,000 real estate agents that responded to the survey would like mortgage closings in 30 days or less. However, the average closing for all mortgage types takes more than than 30 days, according to the survey.
According to real estate agents, mortgage closings are most often delayed or missed due to underwriting, appraisal issues and changes in underwriting policies.
Real estate agents added that the uncertainty of closing dates is disruptive and expensive for borrowers. In fact, 65% of agents said they would be more willing to recommend a particular lender if they provided a mobile "app" to track the status of scheduled mortgage closings.
"Our surveys consistently show that real estate agents recommend lenders that can consistently close on time," Popik observed. "Agents are willing to recommend an in-house mortgage lender, but only if that lender enables a timely mortgage closing that results in an agent commission."