We spend about $750,000 per year on various technology applications with the primary goal of making the mortgage process as simple and as efficient as possible for our clients.
This technology includes our point of sale/application system (Blend), our elaborate CRM buildout (Salesforce), our electronic document reading systems (Candor, Ocrolus), various robotic processing applications, automated verification systems, and much else.
SHOCKED BY SURVEY RESPONSE
This is why I was surprised when we got this survey response back yesterday:
“When we were shopping for mortgage brokers, some of the competing folks we spoke with said that “you’ll get a better rate with JVM but it will likely be more work on your end.” That was accurate. But that said, I’d do it again in a heartbeat, and the team was wonderful, so I appreciate the partnership and help!”
I should add that this borrower was awesome and that he and I had a great follow-up exchange, but I still think his comment made for great blog fodder. He also told me that he had not obtained a mortgage for almost 15 years and was actually unsure if we required more work.
SO, IS JVM MORE WORK?
In a word – no.
Not even close in fact, as we underwrite to the same guidelines that everyone else does. In addition, our massive tech integrations truly do make life far easier for borrowers.
EASY JUMBO LENDERS HAVE 1/2 PERCENT HIGHER RATES
We have jumbo investors that underwrite exactly to Fannie Mae’s far less stringent guidelines.
(Note: “investors” are the banks and entities that buy loans from mortgage banks like JVM)
These “easy investors” are particularly helpful with respect to reserves (none needed), debt ratios, credit, and overall documentation requirements.
BUT – the rates at the easy investors are usually 1/2 percent higher or more than those of our best jumbo investors.
So, yes, underwriting for the easy investors would save us and our borrowers a tremendous amount of time and effort, but the cost would often be hundreds of thousands of dollars of extra interest over the life of the loan.
So, even though we could save a huge amount of time and money by going the easy route, we must in good faith quote our lowest rates – which unfortunately come attached to far more stringent investors.
HIGH-END BORROWERS & AIR-TIGHT PRE-APPROVALS
Here are a few other factors that may foster the impression of “more work.”
Highly qualified, high-end borrowers. We tend to attract extremely well-qualified borrowers with millions in the bank and very low debt ratios. These borrowers know they are highly qualified too, and they often tell us that their loan will be “no problem at all.” BUT – these borrowers also often have multiple partnerships and business interests, numerous properties, and tax returns that Albert Einstein would have trouble deciphering. As a result, these loans require an immense amount of work no matter what. And unfortunately, these borrowers sometimes compare notes with their much less complicated friends (W2 only; conforming loans) who had to do almost nothing to get their loan approved.
Air-tight Pre-Approvals. We pre-underwrite every borrower up front in ways that few other lenders do – to make sure there are as few issues as possible when borrowers go into contract. As a result though, borrowers sometimes complain that we are asking for much more up front than other lenders do. We do this though for their protection. This is actually a great time to remind everyone about the time I caught my dog, Kevin, issuing pre-approvals! It was terrible and something I never want to go through again. 😊
