s are hesitant to add them. Many originators think renovation loans are too complex – but that’s not really the case, according to Shaun Hamman, executive vice president of wholesale and correspondent sales for American Financial Resources.
“I think one of the biggest misconceptions about renovation loans in general is that they’re difficult to do and can create a hurdle for the client,” Hamman said. “In reality it’s just a traditional mortgage with a few other nuances.”
And offering the widest variety of products possible makes an originator an even bigger asset to his clients, Hamman said.
“I think one of the biggest things that we see is that individual loan officers are apprehensive of change. Any time that there’s a new product or program, they always want to look to their buddies to the left or the right and say, ‘Is this product for me?’” he said. “The reality is that you need to aggressively look at the product range. Your clients are coming to you for an opinion on what product is best for them. Every originator should be well-versed of the various product type. (The renovation loan) is perceived as a really difficult product, but when you break it down, it’s really nothing more than a few extra forms. You’re really doing a disservice if you’re not offering a complete mortgage package.”
Hamman said many originators worry that processing renovation will be too complex. However, AFR offers a service to take that worry off brokers’ hands.
“At American Financial, we kind of eliminate that issue,” he said. “We have a service called on-demand processing. We will process and handle any of your loans, but in particular a lot of lenders utilize us not only for our expertise in the marketplace, but for our expertise in processing construction loans. That allows us to have our specialized and trained processing staff handle these loans. The processors at the companies enjoy that, because they can work on the types of loans they’re familiar with.”
Renovation loans can be valuable assets in an originator’s toolkit, but many