To build a solid reputation, brokers first must make sense of their clients' needs

Joseph Badal, senior executive vice president and chief lending officer, Thornburg Mortgage

As published in Scotsman Guide's Residential Edition, October 2006.

If you asked most people looking to buy or refinance a home what they wanted from a mortgage broker or lender, their answers would likely be the same: a low interest rate, a quick and easy approval process, and a quick and easy closing.

Many borrowers seem to approach the entire loan-approval process as if it were as dreadful as a root canal and as confusing as programming a videocassette recorder. At the mere mention of annual percentage rates, private mortgage insurance (PMI), ARMs and disclosure statements, homebuyers can break out in a sweat as they croak, "Just find me the best rate possible."

Managing fears about the mortgage-lending process and having competitive pricing are important parts of the service that brokers and lenders provide to their clients. But there is much more to it.

Giving clients what they say they want is not always the best route. To build a sound reputation in our business and to keep word-of-mouth referrals flowing, take the time to understand what clients really need, not just what they say they need.

To do so, brokers must educate borrowers on their options, ask the right questions to understand their needs and help borrowers look beyond interest rates.

Help clients understand

In recent years, there was an abundance of news stories about the housing and mortgage markets. They told of how hot the housing market was and of how mortgage lenders had created a host of new loan products that made it easier than ever to afford a primary residence, a second home or an investment property.

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