Marcia's Blog

The borrower the mortgage industry too often overlooks

It’s human nature to prefer things to be as easy as possible. So it makes sense that many of us in the mortgage industry want to focus our attention on those borrowers who are already mortgage-ready.  We know they will easily qualify for a loan and the homebuying process is more likely to go smoothly, providing an easier experience for all of us.

However, focusing exclusively on mortgage-ready consumers is a mistake.

Every consumer who cannot qualify for a loan today is a potential customer tomorrow, if we can help them to improve their financial situation. We do that through financial education.

Homeownership counseling organizations understand that financial education is often the differentiating factor between a consumer who is ready to buy a home and one who is not. While lenders and realtors typically don’t have time to work with consumers to improve their credit and learn better financial management skills, counseling organizations are here to help people to improve their relationship with money and to eventually realize the dream of homeownership.

Many of the obstacles keeping consumers from homeownership can be overcome through financial education.

  • A couple may have never learned how to create a budget and may need someone to sit with them and help them to put together a spending plan that works.
  • A millennial may rotate balances on credit cards rather than pay his or her debts off completely, because no one has explained how much debt impacts one’s credit score.
  • A woman who can afford to buy a home may open department store credit cards because no one has told her that new credit can hinder her chances of getting approved for a mortgage.

When lenders and realtors come across consumers who are not mortgage-ready, the last thing they should do is toss them aside and label them a waste of time. Instead, they should strengthen their relationship with those consumers by referring them to non-profit homeownership organizations that can help them improve their credit and get them ready to buy a home.

By appreciating and working with ALL consumers, the industry can make sure there is a steady stream of borrowers who are prepared to buy homes and stay in those homes. This way, we service the customers of today while preparing the customers of tomorrow.