Three or four times a month I'll get a email from someone extolling the advantages and riches of serving my client as both their real estate agent and their mortgage loan originator. Combining the duties and responsibilities of real estate agent and loan officer into a single person is a practice acceptable in a number of states, including Arizona.
The topic comes up for debate frequently in real estate blogs. It's not difficult (at all) to find solicitations for "agent originators" posted on an almost daily basis.
Does it make sense for one person to serve as both real estate agent and mortgage originator on the same transaction?
In my opinion, the answer to that is a resounding NO!
My primary issue is with one person trying to do the work of two. I am a real estate expert. I understand a lot about financing a real estate transaction, but I am by no means as expert as a full-time mortgage professional. Buying a home is likely the single largest financial commitment a person will ever make. You should demand that a lending professional help you through the process. Someone that originates loans "on the side" is likely not the best person for the job.
As a full time real estate agent, I simply do not have the time to gain a thorough understanding of the nuances of hundreds of available mortgage products. I don't have time to monitor the financial markets and economic trends so that I can properly advise a client when to lock a rate.
Some people have claimed that an advantage to one person handling both jobs is gaining absolute control of all aspects of the transaction. That's pure poppycock. For me to gain absolute control over a real estate transaction, I'd have to represent both the buyer and seller as real estate agent (which I abhor), I'd have to originate the loan, I'd have to inspect the home, I'd have to repair the home (trust me, you don't want to see me with a hammer anywhere near your house), and I'd have to be a title company, an escrow officer, and heck — might as well toss County Recorder into the mix too.
I don't feel any loss of control over a deal when I'm working with lenders. Oh, believe me I've worked with plenty that I wanted to beat senseless, but part of my job as an agent is to work through issues with everyone involved in a real estate sale. We've worked with dozens of lenders ranging from the brilliant to the not-so-swift. We're happy to recommend multiple lenders to our clients and we encourage them to interview multiple lenders — just as they should interview multiple agents. Buying a house is a big deal, it's not something to approach with a "they're all the same" attitude. Sacrificing expertise to gain some level of control is a lousy reason for doing business this way. A good agent will work closely with a lender to ensure a successful close.
The sub-title of this post is, "One-Stop Shopping, or Half-Assed Service?" Let it be noted for the record that I'm sure there are some "agent originators" out there that can serve their clients equally well as experts in both of the diverse full-time positions they are taking on. They are called Polymaths, and they are few and far between. (Think Aristotle, Da Vinci, Blaise Pascal, Ben Franklin, Thomas Jefferson). More likely, you will find someone who is fairly competent in both professions. Quite possibly you'll run across someone of complete incompetence in either or both professions.
I prefer to do my job and refer my clients to superior lenders so they can do theirs. We'll work together to serve the client's best interests.
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