While you have likely been using AVMs (automated valuation models) for many years as a lender, many brokers have only started using them more so in recent years, largely because they have been a product generally offered to lenders. This is no longer the case thanks to advancements in technology.
The lack of use of AVMs or use of some platform to validate property values and home ownership information can largely explain the shock you likely hear from brokers when they submit a deal and without requesting an appraisal, you upsell the deal, down-sell the deal or decline the deal because you disagree with the value as a result of your AVM.
We often blog to brokers about the importance of strong lender/broker relationships. Developing and nurturing these relationships means work on both sides – especially if your approval and funding process is largely electronic, meaning little human contact between underwriters and brokers.
We constantly stress the importance of packaging and due diligence.
One way you can help your brokers to validate information more consistently and from the same source as you is to let them know the types of tools that you use when underwriting deals.
AVMs are an excellent example – just think of how many bad deals would be avoided before crossing your desk if your brokers leveraged AVMs to validate values, registered mortgages and the people on title.
This means education! When your BDMs hit the streets, arm them with more than current rate sales and info on who qualifies for what. Educate them about the tools, tricks and techniques that are available to perform due diligence and better package their deals.
Also – social media. Social media may be a marketing platform you use to attract brokers. Providing brokers with additional content that is of value to them and educating them on how they can be more successful can be a more powerful marketing tool than pushing out rate sales.
Teaching your brokers how they can underwrite more effectively leads to more qualified deals and an immense amount of time and cost savings – to you, your broker and, if you are not using AVMs, your insurers when disagreements re: value occur.
More mortgage brokers and agents are using Automated Valuation Models than every which is excellent for the industry. Get on board, and help your brokers be more effective.
For more about the value of an AVM for your brokers, please contact Purview For Lenders today at 1.855.787.8439.