Last week my neighborhood got about a foot of snow. While running around doing last minute Christmas shopping, I noticed the wiser, more experienced drivers took a slow steady pace and went forward with a minimum of frustration. Inexperienced drivers tended to spin their wheels and loose traction, causing them to go nowhere or slide off into a ditch. This reminded me of some of the buyers/borrowers I have met over the years.

Paralysis by analysis refers to over-analyzing or over-thinking a situation to the point where a decision is not made. As General George S. Patton observed, “A good plan today beats a perfect plan next week”. Thanks to the internet and well meaning, but ill informed friends, I see buyers/borrowers become overwhelmed from information overload. Two examples are:

1. The prospective buyer who wanted to analyze property appreciation by zip code over the next three to five years and maintenance costs broken down by square foot over the same time frame. The client, who was an engineer, was not pleased when I told him I did not have the answer and that I did not believe it was possible to make an accurate projection on a single property. While it would of course be possible to analyze historical trends, as any intelligent person knows, “past performance is not a guarantee of future results”.

2. I had one borrower, a very sharp young accountant, who immersed himself in the internet and tried to put his own numbers together. The problem was that he kept comparing apples to oranges, and trying to apply outdated information to the current mortgage industry.

The cure for paralysis by analysis is very easy. Consider the source of the information. If you were referred by a professional or previous client, you are most likely in good hands. 

Chip Allen

Crestline Mortgage Bankers

A Division of Universal Lending Corp

Direct: 303.947.2109

Fax: 303.987.0676

Colorado Mortgage Broker License # 100019831

NMLS# 378621

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