I remember the vicious phone call vividly.
I took BART into the City on a Friday night to meet my wife Heejin for a date and was climbing the stairs out of Embarcadero station when I received a call from the angriest borrower I had ever dealt with.
She was spitting nails, vitriol and profanity b/c her loan blew up at the 11th hour. She was furious b/c she was at risk of losing her house and security deposit and she just screamed for ten minutes without stopping.
But here’s the kicker – she was not upset with JVM; she was upset with our biggest competitor – RPM Mortgage. I, however, quickly deduced that RPM had done NOTHING wrong.
The file blew up b/c of the borrower’s own actions and not b/c of anything RPM did or did not do. I also learned that the loan officer and one of RPM’s owners were both working overtime to find a new home for the loan.
The borrower’s agent, however, wasn’t happy with any of this, so she insisted that the borrower call me. So what did I do?
I defended RPM and did not play hero and try to take over the transaction.
I sat at the top of the BART station stairs and spent over 30 minutes talking the borrower off the ledge.
The borrower then called me back at 9 PM, after she refueled her anger, and I again had to talk her off the ledge only to hear from her again the next day, when I finally talked her off the ledge for good.
Anyway – below are just a few of the reasons why I didn’t take over the loan.
- RPM had done nothing wrong, and the loan officer was a solid guy who still deserved his commission for all the work he had done.
- RPM was addressing the issue perfectly by nailing down a new investor and would be able to close the deal at least a week faster than we could have (b/c we would have had to start over from scratch).
- The agent threw RPM under the bus even though RPM had nothing wrong, and I didn’t want to be the next bus-victim.
Anyway, we receive transactions that blow up at other lenders all the time and we don’t try to “steal” them unless the loan officer was blatantly negligent or unless the terms are ridiculously unfair (we make sure we can beat the rate by at least 1/4 percent or more).
Similarly, other loan officers I know have sent transactions back to us numerous times over the years, after giving us a “heads up” in regard to our borrowers’ concerns.
We do this b/c we know how much work goes into every loan file, and we know that events happen all the time that are simply out of a lender’s control.
Here are a few things we would like every agent (and borrower) to keep in mind :)
- Loan approvals take far more time and effort than most agents realize. A pre-approval alone can take three to four hours, and getting a file all the way to final approval (and loan documents) can easily take an additional ten hours of work. This is why it is very frustrating for us when borrowers have us fully pre-approval them so they can use our pre-approval letter to get their offer accepted, but they had the intention of using another lender all along.
- We can’t foresee everything/underwriters are human and fickle/gray areas. Whenever something goes wrong, we invariably hear: “JVM should have foreseen this…” But, underwriting guidelines are often far more “gray” than “black and white,” and underwriters themselves are often fickle and willing to dig in their heels without justification. This is just the nature of lending, no matter the organization. We take enormous pride in our diligence and ability to avoid surprises, but they still arise on occasion. When they do, the support of agent partners helps all lenders resolve issues much easier. In my above example, the agent made things far worse by impugning RPM.
- Interest Rates change and are influenced by many factors. We sometimes have borrowers and/or agents tell us our rate is too high even though we are certain that the rate we locked was among the lowest in the industry (we know this b/c we perform weekly “rate surveys”). The reason this happens is either b/c rates moved after we locked or b/c the borrower and agent are not taking into account ALL of the factors that influence a borrower’s rate.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 310167