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Realtor Referrals Supply One-Third of Business for Lenders: Survey

Referrals from real estate agents guide about one-third of mortgage-financing decisions for today's homebuyers, according to a recent survey.

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""Campbell Surveys"":http://www.campbellsurveys.com/ and ""_Inside Mortgage Finance_"":http://www.insidemortgagefinance.com/ polled about 1,800 Realtors in January to learn that agents recommended about 60 percent of the business for mortgage lenders.

The survey inferred from the results that real estate agents influence or shape some 34 percent of mortgage-financed home purchases.

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Recommendations by many agents came about as a result of pre-existing relationships with lenders, with 16 percent of home purchases developing out of lender partners with real estate firms.

And the reasons why homebuyers skipped their agents' recommendations? According to the survey, some cited existing banker relationships with lenders and pre-approval letters from other lenders.

Agents nodded at reliable pre-approval letters as the most important reason for their recommendations.

By the same token, agents cited the reliability of these letters as the biggest problem of 22 factors listed by the study.

According to the study, ""the possibility that even with a preapproval letter a borrower could face a mortgage rejection helps explain why cash homebuyers generally pay about 10 percent less than homebuyers requiring a mortgage when purchasing a home.""

And reciprocity matters. One respondent said that their firm chose to work with a lender over an in-house mortgage person because of a failure by the person to generate leads, and because ""[w]e believe we should support those who help support us.""

About Author: Ryan Schuette

Ryan Schuette is a journalist, cartoonist, and social entrepreneur with several years of experience in real-estate news, international reporting, and business management. He currently lives in the Washington, D.C., area, where he freelances for DS News and MReport.
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