Point-of-sale financing forecast for homebuyers

November 18, 1990|By Jack Snyder | Jack Snyder,Orlando Sentinel

One-stop real estate service -- where a buyer not only can pick out a home but also choose a mortgage and buy hazard and title insurance -- is the wave of the future, says the incoming president of the National Association of Realtors.

"We used to have filling stations, and they became service stations with a menu of services," said Harley E. Rouda, a Realtor from Columbus, Ohio, who became president of the 800,000-member organization last week.

Mortgage funding will be a vital part of tomorrow's real estate sales offices, Mr. Rouda said.

Computerized mortgage-origination systems, in which loan applications can be filed from the real estate office, make that tTC possible, he said.

Realtors' involvement in originating mortgages hasn't been welcomed by many in the lending business, especially mortgage bankers.

But Mr. Rouda said point-of-sale financing is inevitable because the public wants it.

Officials of the Department of Housing and Urban Development recently testified before Congress that point-of-sale financing does not violate the Real Estate Settlement Procedures Act as long as disclosure is made to the buyer that he is being charged a fee, Mr. Rouda said.

The trade association president disputed claims that Realtors will steer clients to particular lenders.

"Sales commissions are worth a lot more to brokers than collecting a nominal fee for [loan] operations," he said.

Mr. Rouda said he believes that computerized mortgage systems would be competitive and reflect the mortgage marketplace.

He conceded, however, that Realtors now generally recommend totheir customers lenders who they think provide the best service, not necessarily the best interest rate. Realtors are especially interested in getting the transaction completed as quickly as possible, Mr. Rouda said.

He said the collection of fees from buyers for mortgage assistance does not create a conflict of interest for real estate sales people, nearly all of whom are agents working on behalf of the seller.

"A broker who helps a buyer obtaining financing to buy the seller's home is helping to close a transaction," he said. "No seller is going to object to that."

Full, written disclosure of all services and fees involved in a transaction provides buyers with protection from conflict-of-interest problems, he said.

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