We Pay Per Diems – When & Why; VA Loans Too

Reminder: We are VA Financing Experts. What makes us so good at them is the fact that we see more VA loans as a team over the course of a year than any one loan officer might see in an entire career. We love VA! We also happily pay Per Diem Penalties if a transaction […]Read More

Buyers Can’t “Roll Closing Costs” Into Their Loan; Options?

Total closing costs for a purchase transaction can vary from $5,000 to $30,000, depending on purchase price, loan amount, type of loan, month of the transaction and location of the transaction. This is b/c closing costs include not only the standard title, escrow, appraisal, underwriting fees, etc.; closing costs also include prepaid interest and property […]Read More

Timing The Bottom For Rates? Get While Gettin’ Is Good

Borrowers often ask us if we think rates will fall further before they lock, and they often want to “time to the market” and lock in their rate at the “bottom.” As a result, they are sometimes reluctant to lock or get us their paperwork. This in turn delays purchase transactions and sometimes causes borrowers […]Read More

Busy vs. Productive; The Big Leap

Although national purchase volume is down from last year, our office is still in the midst of “busy season.” Despite the large volume of things that must get done, our team still strives to manage a work-life balance by actively prioritizing and managing their workdays. This reminds me that we see many people “addicted to […]Read More

The Dispute Over Disputing Disputes (On Credit Reports)

One of our most frequent credit issues involves reported “disputes.” Borrowers report an account in “dispute” whenever they believe some credit data (usually late payments) is reported in error. We usually need to remove the “disputes” from the credit report altogether with an expensive “rapid rescore” and borrowers often do not like this. We must […]Read More

Funding Process Explained; Why Wet/Table Funding Isn’t Favorable

We have had a string of buyers relocating to California from the East Coast lately, and they are confused about the closing process out here. For most purchases in California, the loan is not immediately ready to fund after a borrower signs their loan documents. The “funding package” (signed loan documents and escrow conditions) needs […]Read More

Why Lender-Paid Mortgage Insurance Isn’t Such a Good Deal

We are seeing borrowers come to us with quotes from online lenders for conventional loans with LTV > 80% but NO mortgage insurance. What the borrowers don’t realize is they are being quoted for a Lender-Paid Mortgage Insurance product (LPMI). With LPMI, a lender simply waives PMI requirements in exchange for a higher interest rate. […]Read More

15 Day Close Resumé! My Dog Kevin; Ask For A Resumé Please :)

Every lender and their dog is now claiming they can close in 15 days, when they probably…can’t. How do we know?  B/c we close in 15 calendar days all the time, and we know how hard it is. I even caught my own dog Kevin bragging that he could close in 15 days, and our […]Read More

Types of Loans: FHA, VA, Gov’t, Conventional, Conforming, Jumbo, etc.

There is often a lot of confusion about the names and types of mortgages available in the market place. Here is some general information to address some of the confusion. I. “Government Loans” are mortgages that are either insured or guaranteed by the government or a government agency. They include FHA, VA and USDA loans. […]Read More

Thinking Like an Owner; JVM’s Book Club Again

We wanted to provide a brief edit to last Friday’s Blog about JVM’s Book and Podcast Club, as it looked like there were only 10 books on the list. There are actually 36 books and 3 podcast series – listed entirely here. And again – we’d love feedback. I went to a coffee shop a while […]Read More

Reminders: Amendatory Clause; RPA Signatures; Seller = LLC; Deceased Seller

FHA and VA Amendatory Clause. This form is required for all VA and FHA loans. It lets buyers know they are entitled to the appraisal and not bound to buy the property if it does not appraise. This form needs to be signed by all parties and dated prior to the appraisal. Residential Purchase Contracts […]Read More

Technology & Easy Doc Uploads Does Not A Mortgage Make

More than ever, lenders are introducing and touting new technology and client interfaces as huge breakthroughs and the solutions to all mortgage problems. One of our competitors recently spent $80 million on new technology, leaving us to wonder … how? and on what? We too are on the technology bandwagon and are in fact getting […]Read More

Adverse External Influences On Appraisals – Explained

“Adverse external influences” are structures or entities near a property that negatively affect its value. Appraisers often use the phrase “External Obsolescence” when describing these influences. Adverse influences include freeways, busy arterial through-streets, railroads, BART or mass transit trains, cemeteries, schools and commercial buildings or establishments. Real estate agents involved in transactions with external influences […]Read More

JVM’s Book and Podcast “Club” – Books/Podcasts We Love & Recommend

We encourage everyone at JVM to read, listen and learn as much as humanly possible b/c (1) it helps our team with their personal and professional growth; (2) it helps our clients, as better informed people provide better service; and (3) it helps JVM, as we hugely benefit from when our team members grow personally […]Read More

Must Prove Taxes Are Paid; Payment Plan

We collect the last two years of filed tax returns from almost every borrower, as required for almost every loan program. If the tax returns indicate that income taxes are owed, we must show proof that the taxes have been paid. Proof can be in the form of a canceled check, a receipt from the […]Read More

Hire Lucky People; Be Lucky

Tony Hsieh is a Harvard educated serial entrepreneur and author who co-founded and runs the online shoe and apparel company, Zappos. The man is considered a management guru b/c of his many successes, his exceptional brainpower and the extraordinary culture he created at Zappos. One of our favorite pieces of advice from Mr. Hsieh is […]Read More

Tax Transcripts; Proof Taxes Were Filed; 4506-T; How It Works

Every lender is required to get the last two years of tax returns from every borrower for almost every loan. We then have to prove that the tax returns are authentic and that they were actually filed with the IRS. This is why every borrower has to sign an IRS Form 4506-T as part of […]Read More

Real Estate Marketing – Tips; Lunch & Learn Wednesday

We are hosting a Lunch & Learn on Wednesday in Brentwood, CA. Everyone is welcome, and we promise it will be both informative and entertaining (we’ve tested it in front of ecstatic live audiences already 🙂 All of the relevant info can be found here: Eventbrite Link to JVM’s Lunch & Learn on Marketing. Heejin and […]Read More

Clean Purchase Contracts; No Reports/Inspections; All Addenda

We received a purchase contract last week, and immediately emailed our confirmation of terms request to the Realtor and then ordered our rush appraisal, as per usual. Four days later, we received the appraisal at the contract price of $830,000. Yaaaayyy, right? Wrong. The Realtor forgot to send us the addendum indicating the price was […]Read More

FHA Financing Is Fast, “As Is,” & Easy; 15 Day Close

Heejin and I did a presentation yesterday on marketing for real estate agents, based on everything we have seen work and not work with the hundreds of agents we have worked with. It went really well, and if anyone would like to see it, please let us know. But, this blog topic surfaced after the […]Read More

Lessons for My 22 Year Old Self

I have endured some stunningly dull college commencement speeches, most recently at Columbia University for Heejin’s niece. At most of the ceremonies, administrators give the speeches, exhorting the kids to go forth and administrate :). OK – it is not quite that bad, but I often think about what I would say to make the […]Read More

Can’t Use Business Funds W/o a CPA Letter

This is a reminder that lenders do not allow borrowers to use business funds (from any “business account”) towards a down payment or closing costs, unless borrowers can get a letter from their CPA that states the withdrawal will not adversely impact the business. CPAs, however, are often reluctant to provide such letters nowadays b/c […]Read More

Just Make Biscuits

I was listening to The Investors Podcast recently when I heard an investment guru give excellent advice in response to a question about how people should act in the face of so much potential trouble in the world. The guru advises people to be like a biscuit maker in Portugal, who only focuses on making […]Read More

Appraisal Comes In Higher Than Contract Price? Correlate to Contract; Red Flags

We remind readers often that no matter how high a purchase appraisal comes in over contract price, lenders always have to correlate to the price on the contract for financing purposes. If a purchase contract indicates the price is $500,000 and the borrower is putting down $100,000 (20%), the loan to value ratio will remain […]Read More

Hire “Brains and Character” Over Experience; Avoid “Crisis Hiring”

Today we welcome three new hires to the JVM team! We preach this often, but always think it bears repeating. We have discovered over much trial and error that it is almost always better to hire “brains and character” over experience. By using a strong screening process and our training program, we figured out how […]Read More

Biggest Management Mistake We Made? Making Team Compete

We love illuminating our many mistakes over the years b/c they are both amusing and great learning lessons. Our costly mistakes include relying too heavily on the advice of business coaches, not properly vetting business partners, not doing thorough background checks on employees, not getting basic agreements in writing, hiring managers from outside of JVM, […]Read More

How To Buy Before Selling Current House

We often have buyers who want to buy a new house before selling their current house. They often want more time to move, more time to fix up their current house before selling, or more time to fix up the new house before moving in. They also sometimes want to make offers on a house […]Read More

Closing Days Defined: Contract Date to COE; Calendar Days

We made our reputation on our ability to close quickly time and again. We do it so often in fact that we made a “15 Day Close Resume” with dates, prices, addresses, agent names, etc. – so listing agents can see how well we consistently perform. We actually can close faster than 15 days now […]Read More

Options When Appraisal Comes In Low

Here are a buyer’s options when an appraisal comes in low: 1. Negotiate a price reduction with the seller. This option is often not viable in a competitive market like today’s, when sellers have ample back-up offers. 2. Bring in the extra cash necessary to make up the appraisal shortfall. This option too is often […]Read More

Most Powerful Inspiration In All of Business: In-N-Out Burger!

Some people watch movies for inspiration, some read biographies, and some watch TED Talks and videos. Heejin and I go to In-N-Out Burger. Really, we do. The place is an amazing example of focus, efficiency, teamwork and the benefits of systematizing. We recently went to the one in Santa Barbara to pay homage (and to […]Read More

What Will $75,000 and $100,000 In Income Buy?

Many renters don’t realize how much house their income will buy in this environment, when rates are so low. We often maximize buyer’s qualification by having them use their savings to pay off consumer debt and put less down. For example, paying off debts that total $700 in monthly payments can increase a borrower’s purchasing […]Read More

Rapid Re-Scores Revisited

We often do a “rapid re-score” to repair a borrower’s credit for a variety of reasons: (1) to raise a borrower’s score above a minimum requirement, such as 700 for a HELOC; (2) to improve a borrower’s interest rate, as rates are significantly affected by credit scores; (3) to update tradelines to reflect lower balances […]Read More

Your Cheese WILL Move; Examples

Heejin is aggressively exploring JVM’s expansion into the Texas market, and amazingly it only took her about three hours to find high-end, class A office space like we need to attract talent. She used websites like WeWork and Truss to map out everything – commutes, demographics, leasing costs, layouts, furniture design, etc. In contrast, when […]Read More

What Happens When You Quit-Claim Off Title; “Due On Sale”

Borrowers often ask us if they can quit-claim off title after they purchase a property. We first remind borrowers of this: If a borrower quit-claims off title he or she is still obligated to pay the mortgage. If the person remaining on title fails to make timely mortgage payments, the quit-claiming borrower’s credit will be […]Read More

Why We Hire Brains & Character Over Experience

Last I week I blogged about our office manager who embezzled $200,000, and how she was a result of a “panic hire.” We needed help so badly that we hired the first person we found with experience. As we started to grow, we frequently turned to applicants with experience to fill slots even when we […]Read More

Prime Rate Up; HELOCs Up; PMI Down

Prime Rate was 3.5% last year at this time. Currently the Prime Rate is 4.25%. It has been climbing steadily with every increase in the Fed Funds Rate. Prime Rate is the interest rate that large companies pay to borrow funds for short periods. It matters to real estate b/c Home Equity Lines of Credit […]Read More

What If Spouse Has Horrible Credit? Too Much Debt?

We frequently get husband/wife borrowers where one spouse has stellar credit and the other has awful credit. Most people know that the solution is simply to do the loan in the name of the “good-credit-spouse” only, as long as the good-credit-spouse has sufficient income to qualify on his or her own. The bad-credit-spouse can do […]Read More

Retaining Talent – Culture & Profit Sharing; Not About The Money

Recruiters from other mortgage companies constantly call our team members to lure them to their firms… and it always elicits chuckles across our office b/c the recruiters are so clueless. They don’t understand our model or why our top performers stay. Heejin and I used to be even more clueless when it came to retention […]Read More

Why Rates FELL After Fed RAISED Rates; Econ Data Trumps Fed Policy

The Fed raised its short term “Fed Funds Rate” again yesterday, but long term mortgage rates fell. Once again, the Fed Funds Rate is only a short term interest rate (the rate that banks charge other banks for overnight loans necessary to pad their required reserves). This short term rate does not always directly influence […]Read More

How To Hire Great People; Horror Story

It was June of 2011 when Heejin noticed one of our deposits was smaller than it was supposed to be. So Heejin dug a little deeper and found a bunch of accounting irregularities. She then got very worried, continued to dig and discovered over $200,000 had been embezzled from our accounts. Our officer manager was […]Read More

How & Why We Offer “No Cost” Refi’s

Nobody, and I mean nobody, expected rates to fall this much in 2017. When rates do fall, we reach out to all of our eligible borrowers and offer the option to refinance – usually at “no cost” (where JVM pays for all non-recurring closing costs). Borrowers sometimes wonder how we get paid when we offer […]Read More

Why Elite, Awesome Marketing Company Lost Our Business

We recently sent requests for proposals to elite marketing firms all over the United States, and were pleasantly surprised by the reception. The firms wanted to work with us b/c they loved our website, focus, messaging, image, etc. They were happy to avoid the basics of “Marketing 101.” What was most interesting though was how […]Read More

Things to Know About Mortgages and Divorces

This is a popular blog from January that we think is worth repeating b/c the info is so important. Things to know about mortgages and divorces: 1. Spouse can quit-claim off title, but NOT off the loan. The only way a spouse can get “off a loan” is with a full refinance. 2. If a […]Read More

Beware “The Happiness Bubble”; Scrum

On June 1st, when I walked into our office, everyone was silent, focused and intensely working. Also on June 1st, we had a one-hour meeting at 2 PM to go over our systems, processes and training to fix everything that needed improvement, like we do every week. I point this out b/c May was an […]Read More

Condos – Three Numbers To Know

If you’re looking at a Condo, there are three numbers to know: 1) % of owners delinquent with HOA Dues: Less than 15% of owners must be less than 60 days late. This number is often an issue after market corrections b/c people are more likely to walk away from condos (and stop paying HOA […]Read More

What’re You Reading? Real Education After Formal Education

I loved college and was an excellent student who tried to learn as much as I could during my academic years. My problem was that after law school, I stopped learning the things I needed to learn. I didn’t realize that my real education only started after my formal education. I continued to voraciously read […]Read More

Cash Out Refi’s Back – For Good Reasons This Time; Down Payments?

Prior to the meltdown in 2006, almost 90% of all refi’s were “cash out,” meaning that borrowers increased the size of their loan with their refi. Borrowers effectively used their homes as ATMs, and used the cash from their refi’s to buy expensive cars, time-shares, vacations, boats and other luxury goods. Heejin and I bore […]Read More

Know Your “Why” For More Business and More Fun

I exchanged emails with an extremely successful friend in the mortgage business over the weekend. He was having his best month ever, but was nevertheless feeling very down. The constant grind of the business had gotten to him. His focus is on awesome customer service and on growing a great business, but he doesn’t have […]Read More

Calling Listing Agents; From 2nd to 1st; What We Tout

Some of our selling agents have us call the listing agent every time they make an offer. They do this b/c it works. The effectiveness of listing agent calls was illuminated again this week when our phone call pushed our offer from a solid 2nd place to a rock solid 1st place, and we’re now […]Read More

Recurring and Nonrecurring Costs; Estimating the Total for Credits

A few readers had questions yesterday about recurring and nonrecurring closing costs. Note: I was using the term “reoccurring” yesterday but according to the internet, “recurring” is the more correct term, even though the meaning is very similar. Nonrecurring closing costs include the one-time fees that buyers pay only at the time of purchase. These […]Read More