Call Center Horror Story :) The Need for Training & Skill

CALL CENTER FAIL Last week a borrower came to us to discuss her refi b/c she had lost trust with the lender she was working with (America’s largest non-bank lender). In any case, she was trying to refinance the house she lived in but it was owned by her Dad and she was not on […]Read More

Another Gov’t Shutdown Update; Must Be On Title If On Loan; Title Only

GOVERNMENT SHUTDOWN NOT AN ISSUE FOR MOST BORROWERS I read recently that there are buyers waiting on the sidelines b/c of concerns about the government shutdown. They shouldn’t be b/c the shutdown is not affecting that many buyers. There are some issues causing delays such as furloughed employees not being able to close until they […]Read More

Digital Marketing Is NOT What You Think It Is

We work with an agent who closed 140 transactions over the last year, totaling over $100 million in sales. And when you google her, she literally dominates Page 1 of the search results, with everything popping up – Yelp, Google Reviews, Zillow, Reach 150, Realtor.com, Google Business Info, LinkedIn, her website, etc. Is this the […]Read More

Why Rates Matter So Much Now

GOV’T SHUTDOWN UPDATE The IRS has agreed to process tax transcripts (tax return verifications). This is good news, as this could have held up the funding of numerous loans. REALTOR DROPS LOAN OFFICER B/C HIS RATES WERE TOO HIGH My wife Heejin recently visited a Realtor who had been using the same loan officer for […]Read More

Hire Skill Over Experience – Like Clemson & Silicon Valley

I don’t watch college football, but I do read the headlines and follow the drama b/c the stakes are so high for the coaches, schools and players (who hope to go to the NFL). That is why this recent headline in the WSJ caught my eye: How Clemson Emulated Silicon Valley To Win a National […]Read More

The Fed Lost Control Over Interest Rates; Now What?

RATES AT 8 MONTH LOW Rates are at an eight-month low right now – about 1/2 percent lower than they were at their peak in October. I should add though that they still remain about 1/2 percent higher than they were last year at this time. So, did the Fed finally achieve its stated goal […]Read More

An Homage To My Hero Herb Kelleher of SW Airlines

I learned this morning in this WSJ editorial that SW Airlines founder Herb Kelleher passed away recently. The man is one of my heroes b/c his entrepreneurial exploits are the stuff of legends. He built one of the world’s mightiest airlines and made air travel far cheaper for everyone despite ferocious opposition from the entrenched […]Read More

Max Number of Financed Properties

We often see borrowers with multiple financed properties nowadays b/c so many of them have been on buying sprees since 2008. Having more than four financed properties used to be an issue b/c so many lenders and investors were excessively restrictive after the 2008 meltdown. But, guidelines have definitely softened and there are now multiple […]Read More

When Renovation (203k) Loans Are Not Practicable

Renovation loans, also known as “203k” or “Homestyle” loans, are an awesome resource for properties that are badly in need of major repairs or updating. These loans allow buyers to finance major home improvements with their initial purchase money mortgage by increasing the mortgage to cover the cost of improvements. For major repairs required by flood, […]Read More

Two Areas Big Banks Beat Us: CRA and Private Banking

I mentioned yesterday that we have been beating the “big banks” across the board on the interest rate front. But, there are two areas where we rarely beat the big banks in rate: CRA Loans and Private Banking. CRA LOANS CRA stands for Community Reinvestment Act. It is a law that “encourages” (aka requires) banks […]Read More

Five Misleading Closing Cost Tricks the Big Banks Play

We have been stealing a lot of loans lately from the big banks b/c our service is better and our rates are lower. As a result, the big banks are using some very aggressive and often misleading tactics to win borrowers back. These tactics include massively understating closing costs and then implying that their closing […]Read More

The Beverly Hillbillies Recession Prediction – A Recession Is Coming For Sure!

CURING THE COMMON COLD When I was a kid I loved a TV show called The Beverly Hillbillies. It was about a family of hillbillies who struck oil, got rich and moved to Beverly Hills. The family matriarch was Granny and she had a cure for the common cold that made the family’s banker (the […]Read More

Great Lessons from Budweiser

I am reading a fascinating account of Anheuser-Busch’s (Budweiser’s) rise and fall in a book called Bitter Brew. The book mostly illuminates how not to run a business or live a life, as the Busch family managers were often conniving, back-stabbing, misogynistic, vindictive, womanizing, arrogant jerks. It is amazing that the company thrived for as […]Read More

How The Government Shutdown Will Affect Mortgages

Many people are wondering how the government shutdown will affect the funding of mortgages. The last time we endured a protracted gov’t shutdown was in 2013 when it lasted for 16 days. PRIMARY CONCERNS: TAX TRANSCRIPT (4506t) VERIFICATIONS AND FLOOD INSURANCE At that time, the only major holdup had to do with Tax Transcript Verifications […]Read More

Trader Joe’s and In-N-Out: Fans, Not Customers

We give every new hire a copy of a book about In-N-Out Burger. We do so b/c In-N-Out is a great example of business that thrives with no marketing at all b/c its extraordinary customer service, systems and focus on quality keep customers coming in droves. In-N-Out’s story is simply a great business lesson for […]Read More

Surprising Reasons Why People Are Refinancing

The Fed raised short-term rates again yesterday but rates still remain much lower than expected. Part of the reason is that investors think the rate increases will hurt the economy at this point. As a result, investors moved from stocks to bonds and this demand for bonds keeps rates lower than expected. In any case, […]Read More

Wartime & Economics in The Mortgage Industry

A few random mortgage industry stories. TOP AGENT WON’T REFER CLIENTS TO CLOSE FRIEND: This week, Heejin (my wife & co-founder) was visiting a top producing Realtor in Texas who refused to refer clients to her close friend who was a loan officer. The reason? Her friend’s rates were too high and her clients complained. […]Read More

Why Hard Money Is Dead; “Healthy” Sub-Prime Lending Is Back

WHAT IS HARD MONEY “Hard Money” or “Private Money” refers to mortgages made by private (non-institutional or non-bank) investors or funds that focus almost exclusively on collateral (the property) and not on a borrower’s credit-worthiness. In other words, hard money lenders will give almost anyone a mortgage as long as they have 30% of the […]Read More

How To Play Bigger; Be Different, Not Just Better

Heejin and I were recently invited to a Bay Area meeting of the Forbes Business Council, and we quickly wondered why we were invited to a Bay Area meeting of the Forbes Business Council. 😊 The reason was that we were the only people there who were not tech company founders worth $100 million (or […]Read More

ARMs; Asset Depletion Loans; Debt Service Coverage Loans; Mixed Use Properties

Here are a few quick mortgage reminders/updates: I. JUMBO ARMs REMAIN VERY LOW.  I mentioned yesterday that our Jumbo 30-Year rates are as low as ever, but our JUMBO ARMs are even lower.  Our 7/1 ARMs, for example, remain in mid-3%range for no-points loans for qualified borrowers. II.ASSET DEPLETION LOANS.   These are the perfect option […]Read More

Jumbo Rates Are LOWER Than Our Conforming; Jumbo vs. Conforming

Our Jumbo rates are as much as 1/2 percent lower than our Conforming (Fannie and Freddie) rates. Our low Jumbo rates are also available for qualified borrowers down to the “low balance” conforming loan limit of $484,350. These very low Jumbo rates are highly unusual and there are several reasons for this including: (1) Fannie […]Read More

Cracking the Perfect Credit Score? Don’t Bother…

200 MILLION AMERICANS NOW HAVE FICO SCORES About 200 million Americans now have FICO Scores, and about 3 million have perfect scores of 850, according to this Bloomberg article – “How More Americans Are Getting a Perfect Credit Score.” America may be approaching “peak credit score” with average scores now above where they were at […]Read More

Marketing Person or Someone in the Trenches On Your IT Team?

FINTECH COMPANY FORGETS TO ATTRACT CUSTOMERS A close friend of ours was the Chief Product Officer at a prominent fintech mortgage lender in Silicon Valley. The firm was very impressive, consisting of about 70 people, 28 full-time engineers and a war-chest full of VC money (about $70 million). They used all that money and all […]Read More

Seller 2nds/Carrybacks Are Kosher; See Our Winter Seller’s Guide

SELLER CARRYBACKS In yesterday’s blog about how sellers can help buyers, I failed to mention an important avenue – Seller Carrybacks or Seller 2nds. Almost all conforming loans allow for seller carrybacks as long as: (1) buyers still meet the minimum down payment requirements – usually 5% of purchase price or more; (2) the note’s […]Read More

How Sellers Can Help Cash-Strapped Buyers (They Can’t Gift Funds)

SELLER CAN’T GIFT FUNDS An agent recently asked us if a seller could gift funds to a cash-strapped buyer to help the buyer get into the home. The answer unfortunately is no. This is what sellers can do to help cash-strapped buyers. 1. Closing Cost Credits. Sellers can give credits up to 6% of the […]Read More

Learning From DoorDash – Training in the Trenches

I STEP INTO TRENCHES AND … FAIL We were short-staffed a few weeks ago, so I temporarily stepped into our referral manager/lead taker role, and … failed 😊. I pre-approved people based on outdated guidelines; I was unable to enter all of the data in our Salesforce CRM; and I quickly got buried with all […]Read More

Computers Replacing Appraisers – Coming Soon? Hopefully Not

APPRAISAL STORIES Story #1 We had a borrower come to us a few weeks ago to refinance b/c she needed cash to repair the inside of her home that had been badly damaged by a burst water pipe and the resulting flood. B/c of the extensive damage, our only option was a 203k (rehab) loan […]Read More

Good News! Fed Says Rate Increases May Halt

We have almost 1,000 pre-approved borrowers in our pipeline and all of them breathed a sigh of relief yesterday. The reason? Two top officials from the Federal Reserve recently implied that the Fed may be done or close to done pushing up rates (a December increase is still likely). Our pre-approved borrowers should be delighted […]Read More

2019 Conforming Loan Limit Increases – Good and Bad

PEOPLE WALKED AWAY FROM MORTGAGE OBLIGATIONS B/C THEY WERE UPSIDE DOWN In 2006, a relative of mine asked me to help her qualify for a condo purchase. Wanting to help, I loaned her enough money to clean up her credit, to pay off her consumer debt and to make a down payment. I then cosigned […]Read More

5 Reasons Why This Winter Is The Best Time To Buy

Most of our agent-readers well know why winter can be a great time to buy from a real estate perspective. I am nonetheless repeating a few of the obvious reasons while also illuminating a few less-obvious mortgage-related reasons. 1. Rates Hit Six Week Low! While rates have been climbing for most of the year, they […]Read More

Learning From 100 Days of Rejection; Happy Thanksgiving!

Jia Jiang is a famous author and TED Talk speaker who has made an entire career out of getting rejected. To desensitize himself to rejection and to make himself able to ask for anything without fear, he practiced getting rejected for 100 days by asking for ridiculous things. For example, he asked for a “burger […]Read More

Marketing With Videos – Easier and More Effective Than You Think

ARIZONA’S TALLEST TREE Amanda Lee from our office recently took a Facebook Marketing class, and the teacher, Bill Hillestad, highlighted a prodigy of his teaching named Chris Prickett. Chris is a Realtor in Anthem, AZ who quickly dominated his target market b/c of his effective video marketing via Facebook. His videos are not professionally produced […]Read More

When Experts Are Very Wrong – Market Timing

Pierre Andurand is a highly educated French businessman, billionaire and hedge fund manager who is an expert in oil, as oil is the primary focus of his giant hedge fund. As recently as June, Mr. Andurand predicted that the price of oil would hit $100 per barrel in 2018, and that it could rise as […]Read More

What Could Bring Rates Plummeting Back Down?

According to Freddie Mac, the average 30-year fixed rate mortgage was 4.83% in October. We have not seen rates that high since 2011, and the Fed seems determined to continue to push rates up. Even though it seems likely that rates will continue to climb, there are some things that could bring them down again. […]Read More

Calling Listing Agents With Every Offer

This is another reminder that we love to call listing agents when offers are made simply b/c it is so effective. Listing agents have in fact told us on numerous occasions that it was our phone calls that pushed our buyers to the top. When we call, we follow the same script every time and […]Read More

Why A.I. and Algorithms Will NOT Take Over Mortgage Lending

WHAT KEEPS ME AWAKE AT NIGHT? One of the many things that keeps me awake at night is my overwhelming fear that Artificial Intelligence (A.I.) and Algorithms will take over the lending industry, making 99% of everything we built at JVM instantly obsolete. It seems all but inevitable that software will “eat” the mortgage industry […]Read More

Repairs Prior to Close or Prior to Owning the House

Appraisers often call out condition, health and safety, or repair issues that need to be addressed prior to close. Examples include missing floor coverings or water-heater straps, or peeling paint. If the repairs are minor, there is usually not a problem. Significant repairs present problems, however, because sellers often are unable to do them (REOs, […]Read More

Transparent Pricing for Mortgages; It Worked for Macy’s and Wanamaker’s!

In the 1870s, department stores Macy’s and Wanamaker’s completely transformed retail and soared to heights unseen by any retailer up to that time. What did they do? They put price tags on their merchandise! Prior to price tags, consumers didn’t know the cost of any item until they brought it to the counter and haggled […]Read More

How Much Are PMI Payments? How To Estimate Your PMI

Most everyone knows that buyers who put down less than 20% usually have to purchase Private Mortgage Insurance or PMI. But most people also have no idea how much PMI payments are. PMI payments can be made monthly, in a lump sum at closing, or as a combination of the two. Most of our borrowers […]Read More

“Jumbo” Rates Now Lower Than Conforming (Fannie and Freddie) Rates

Fannie Mae and Freddie Mac now have serious competition for “high balance” loan amounts above $453,100. For years, few Jumbo lenders could match Fannie’s and Freddie’s “conforming” loan rates. (As a reminder, a “conforming loan” is a loan that conforms to or meets all of Fannie and Freddie’s guidelines). But, many jumbo investors now offer […]Read More

Lender Credits for Closing Costs – Success Story & Reminder

LENDER CREDIT SEALS THE DEAL An agent we work with was able to get one of her clients into contract on Friday by taking advantage of the large lender credits we are able to offer. It was a $600,000 FHA purchase and the buyer’s previous lender was unable to offer a lender credit, effectively killing […]Read More

Teddy Roosevelt – Amazing Human Being & Great Motivation

A friend of mine (a mortgage bank owner) sent me a great Teddy Roosevelt (TR) quote that he sent to his sales team as motivation during what are clearly tough times in the mortgage industry as a whole. I will of course share the quote, but I want to mention a few of the things […]Read More

Stock Market Corrections, Real Estate & Mortgages

The stock market has been particularly volatile lately, and there are many predictions of another large “correction” that could come any day now. Here are a few considerations in regard to a stock market correction, at least as they relate to real estate and mortgages. A stock market “correction” is defined by The Motley Fool […]Read More

Seller Rent Backs & Owner Occupancy Rules

OWNER OCCUPANCY Fannie Mae, Freddie Mac and FHA all require buyers to move into a financed property within 60 days of close of escrow to meet owner-occupancy requirements. As a reminder, FHA offers only owner-occupied financing (FHA offers no investment property financing), and Fannie and Freddie of course offer much better terms for owner-occupants b/c […]Read More

Five Options When Appraisals Come In Low

Whenever an appraisal comes in under contract price, we work quickly to consider all options with both agents and buyers.  We can usually resolve appraisal issues within one business day if everyone is responsive.  Below are five of the options available when an appraisal comes in under contract price. 1. Rebut the appraisal. This approach […]Read More

Why Pixar Made Steve Jobs WAY Better at Selling Computers! It’s All About the Story!

When Apple launched its “Lisa” computer in 1983, it purchased massive newspaper ads with several columns in nine-point font that set out ALL of Lisa’s features. And – nobody cared. Lisa flopped. And Jobs ended up losing his position at Apple. 14 years later, after Jobs returned to Apple after he had been at the […]Read More

“Pre-qualifications” and Job History

Pre-qualifications vs. Pre-approvals One of the issues with all of the online pre-qualification tools as well as with “pre-qualifications” in general (like what banks perform) is that they do not account for job history. With a “pre-qualification,” either software or a loan officer does a preliminary analysis based on credit, income, assets and loan amount. […]Read More

Lead Follow Ups & Conversions = Way More Than Being “Hungry”

Back during my loan officer deals, agents used to tell me they loved sending me referrals b/c I was “hungry.” They all assumed my relentless follow ups and high conversion rates were a result of me being “hungry” for more business. But, my follow up skills were less a result of me being hungry and […]Read More

Cash Out Now Before It Is Too Late!

I blogged last week about the importance of liquidity, and as a result we received several inquiries in regard to cash out mortgages (even though that was not the intent of the blog). One of the inquiries was from a real estate agent who wants to make sure she is liquid enough to snap up […]Read More

Best “Sales” Book Ever! Ovitz Autobiography

I just finished one of the best books I’ve read in years: Who Is Michael Ovitz? Ovitz was the “super agent” who created the CAA talent agency. He represented the biggest names in entertainment from the 1970s – 1990s, including Robert Redford, Tom Cruise, Paul Newman, Stephen Spielberg, Robert De Niro and many others. He […]Read More