First you’ve got a customer who mostly doesn’t understand anything about buying a home. We don’t understand the market place or any facets of the lending process. It is not only important to help them find a home or get approved for a loan, but also to educate them on the location decision as it relates to potential equity gains as well as knowing the different types of loans available and what the long and short-term financial impacts of these loans are.
In many cases these buyers are limited to some loan programs as well as the type of home they can afford. Many of these buyers may also have credit issues as they either simply set up credit there or have not purchased a home do for credit issues and have rented for a number of years believing they could never be accepted.selling a home offers excellent info on this.
I work with fall in the latter category, many of the first-time home buyers. This is an immense marketplace. Even in slow times, many people just don’t believe they’ll ever qualify for a house, so first-time home buyers with some credit issues can be a good business source. For the most part, it is a simple process to review the credit report and make some corrections to raise credit scores. I find that these types of buyers are also extremely grateful if you help them achieve the goal of owning a home and can be your biggest source of referrals in most cases. My experience as a licensed credit repair coach at Central Michigan University in 2002 has proven to be a valuable resource in working with credit-challenged clients and through scores in 30 to 60 days from 50 to 100 points.
It is important to educate them about all aspects of buying a home while dealing with a 1st time home buyer. The aim for the first time home buyer should be to continuously improve the equity position there as well as the accumulation of personal assets. I worked with many first-time home buyers from where the first loan was a two-year fixed sub-prime loan after the 2nd year due to that client’s continued mentoring. Our job never ends with a first time home buyer. Most of us continue to provide them with credit, budgeting, and resource education to set up investment accounts, anything that helps them grow both personally and financially.
My method of dealing with a first time home buyer also offers an escape plan that will take place 2 to 3 years after the loan is completed (2 years if sub prime). The customer is usually in a better position at that time as far as the type of loan they can qualify for and can now really start to take advantage of the many different strategies for creating wealth by properly managing home equity and mortgage there.
Ultimately, if you have the ability to work with home buyers for the first time, they realize that they have special needs and they deserve our attendance. This is the beginning of a life-long journey for them and as a mortgage lender or real estate agent you have the opportunity to build a good customer whose loyalty would be proportionate to your efforts to help them succeed.