Getting a mortgage isn't just about whether you can qualify. It's also about whether you can work well with your loan officer, making the process smoother and easier for both of you.
Ideal customers are not only financially well-positioned, they're also knowledgeable, realistic and cooperative, says Joe Metzler, mortgage consultant at Mortgages Unlimited in St. Paul, Minnesota.
Conversely, no matter how qualified you are to get a mortgage, your loan might never close if you ignore instructions and treat your mortgage lender like a misbehaving puppy.
"Some people get it. Some don't," says Jay Dacey, mortgage broker at Metropolitan Financial Mortgage in Minneapolis. "You don't have to have perfect credit or super-high income to qualify. It's really more about their attitude than their finances."
"The number one reason loans don't close on time is because of a non-cooperative borrower," Metzler says. "I ask one customer, 'Can I get your two most recent paystubs?' and an hour later, I have them. The next customer, it's two weeks and I'm still begging."
With that in mind, here are nine ways you can become your mortgage lender's favorite client:
No. 1: Be well-qualified to get a mortgage
You don't need an 800 credit score to get a home loan. Nor do you need a 20 percent down payment to buy or 20 percent equity to refinance.
Still, hitting those numbers -- or close enough -- certainly doesn't hurt your chances. Many borrowers have excellent credit, plenty of cash and at least a small down payment or some equity in their home.
"The ideal person has a good credit score, good down payment, low debt ratio, been at their job forever, no bankruptcies, no foreclosures -- just a straight-up regular good person," Metzler says.
No. 2: Don’t be clueless about your credit
Some borrowers are overconfident. Others genuinely aren't sure whether they can qualify. Neither is a problem for lenders.
The true troublemakers are those who know they don't have a prayer, yet make the call anyways, says Metzler.
"If you've never paid anybody on time ever in your life and you have a bankruptcy from last month, thinking you can get a loan and calling a lender is nothing but a waste of time for everybody," he says.
No. 3: Respect your loan professional
The best mortgage customers come from referrals because they bring an attitude of trust to the relationship from the start, says Dacey.
Whether the referral comes through a financial planner, real estate broker or next-door neighbor, it tends to create a much better working relationship, he says.
"When the client has the approach of working with an expert and is appreciative of your stature, that just makes for a better experience for both myself and the customer," Dacey says. "You're really doing business together."
No. 4: Don’t be angry and confrontational
Qualifying for a loan isn't that hard, but a lot of paperwork is required. Before your loan can be approved, every "i" must be dotted, "t" crossed and checkbox ticked. There are no exceptions and arguing doesn't change that.
"I don't enjoy being questioned and yelled at by people who are annoyed at lender requests," Metzler says. "We request documents for a reason. I explain on a regular basis: 'This isn't Joe's rule. It's not Mortgage Unlimited's rule. It's the rule.'"
No. 5: Be educated about mortgage basics
"I generally like a mortgage-educated customer," Metzler says. "An educated customer already understands basic concepts which allows me to help, guide and coach them rather than trying to explain that I'm not a crook."
What's a basic concept?
One is that no-closing-cost loans don't actually exist. The costs you don't pay upfront are hidden in a higher interest rate or larger loan amount.
No. 6: Don’t be an overly aggressive rate shopper
Most borrowers understandably want the lowest interest rate and fees they can get, and shopping for the best mortgage rates is certainly how to go about it. But some borrowers are downright aggressive about rate-shopping, making themselves nuisance customers.
In fact, that super-low rate doesn't really exist, Dacey says.
"Our market is so competitive that rates and fees are all so close from company to company," he says. "There's not some magic pool of money that's cheaper."
No. 7: Be open and honest
Giving the lender all the facts about your financial situation upfront is a huge help, says Fred Arnold, loan originator at American Family Funding in Santa Clarita, California.
"What matters is the client telling you everything they know upfront, providing all the paperwork needed as quickly as possible and being open to the fact that we're going to ask for additional paperwork," Arnold says.
What information is important?
Examples include a prior bankruptcy or foreclosure or a recent gap in your employment history.
No 8: Be cooperative about following instructions
When lenders ask for documents they're usually very specific about what they want. It's up to you to comply rather than try to take shortcuts.
Bank statements are a good example.
"If we ask for two months' bank statements with all the pages and you send a web printout showing you have the money in your account, that's nice," Dacey says, "but what we actually need is two months' bank statements with all the pages."
No 9: Don’t be uncooperative about requests for documents
Nightmare customers refuse to hand over personal financial documents that are necessary to close their loan, says Arnold.
"Many of the additional items we ask for sometimes don't make sense to the average person," Arnold says. "There was so much fraud six or seven years ago that today every loan goes through the deepest of scrutiny."
Delays are especially problematic if you're buying a home or your rate lock is about to expire, Arnold adds.
"When a client resists and we're struggling to get the paperwork, that ends up creating a lot of stress for both the client and us," he says.
The bottom line is that lenders appreciate clients who have a positive attitude as well as a strong financial position. If you're a terrible customer, you might still get a loan, but it won't be a good experience for you or your lender.