Last Friday on the 6 o'clock news I watched an item about foreclosures. Apparently in Florida, foreclosures are up - way up - over last year. Thank goodness that isn't the case in Victoria, where increases in the value of residential real estate haven't triggered a big run on equity take out loans to fund consumer purchases. But be that as it may, that isn't why I'm posting this short note. I'm posting this note because the interview on the item about foreclosures was such a total crock.
I missed the intro to the interview, but a reasonably intelligent looking man was responding to a question to this effect – why are all of these people being put through foreclosure? The interviewee looked into the camera and said:
'Their realtors put them into a property which ….' blah blah blah …' was way too expensive …' blah blah blah.
Wait a minute here! Isn't this the news! Isn't the news supposed to report facts? Last time I checked, it wasn't real estate agents who approve mortgage loans. It isn't in their job description!
So why did this 'news' item leave the unchallenged impression that it was all the fault of the real estate agent? I don't know. Maybe it has something to do with ratings – everyone knows the race for ratings can trigger a blurring of the line separating news reporting from news editorializing.
But in this case I don't think it was that. Because even good news editorializing has to rest on an accurate factual basis. No - in this case I think it was just a case of sloppy reporting.
So just for the record, the first thing any real estate agent worth a pinch does is ask if his or her client has been approved for mortgage financing, and for 'how much'. Why? There are at least three good reasons.
One, it's just good business sense. After all, the real estate agent is running a business and will quickly go broke spending time and energy tracking down the 'perfect' property for a new client only to discover later the client cannot possibly qualify to finance it.
Two, it's a matter of respect for one's client to not waste his or her time showing properties that aren't within the client's financial capacity to purchase.
Three, from the very outset it clearly delineates the agent's responsibility – to find a property for the client which matches the client's 'wish list' in terms of features and affordability.
This isn't to say I wouldn't be troubled if one of my clients ended up in foreclosure. Of course I'd be troubled. But please, before laying responsibility for it at my feet on the local 'news', get your fact straight.
Real estate agents don't approve mortgages!
Until next time,
Bye for now,
...Victoria's blogging real estate professional.
