Archive for November, 2007
Buy Here, Finance Here, At Your Own Risk
November 6th, 2007 categories: Mortgage Strategies
In response to the discussion about Realtors being “encouraged” to use their affiliated lender, I would ask this:
What do you think happens in the Toyota dealership when you are ushered over to the finance department and walk out with a Toyota Motor Credit loan or lease?
That’s right, you have just been referred to the “affiliated lender”.
Does it work to add profit to the dealership?
Of course…especially since you are in an altered state of mind from being under the influence of new car smell.
Is it the best thing for the consumer?
Not by a long shot.
“Buy here, finance here”. That’s what they call it in the auto business (where I spent 20 years of my career). Please, let’s not pretend that the reason real estate companies “encourage” their Realtors to use their in house lender is for the sake of “mortgage broker quality control”. It is another profit center, plain and simple, just like in the Toyota dealership. The more the Realtors use the in house lender, the more money the real estate company makes. Read the rest of this entry »
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