Real Estate Financing...

There's a bad habit I own, that of reading while eating.  Yesterday, I went with Jennifer to partake in a small feast that was our breakfast. 

After sitting down in front of a local version of a western omelet, my eyes pierced the parameters for any bit of written word I could find.  The only one available was The New York Post.  Personally, I think the paper pretty much sucks and the so-called writers/journalists who participate (from what I've read) contribute to my general feeling.  However, they are selling papers and those writers/journalists are making a coin, so who be I to fault them in what still remains a Capitalistic Society?

From page to page I turned to find something that was remotely interesting to read as I indulged in what happened to be one of the better breakfasts I've had on this planet.  I'll plug that small Bethlehem Diner in the near future...

And then there was a story and a passage of which that caught my eye faster than seeing Dustin Diamond running across the beach holding hands with a smitten Corey Haim. 

The following is that passage and ended that story:

"The Henrys settled on two lenders that made similar offers.  In the end, it came down to perks.  One offered frequent flyer miles for every $10,000 borrowed.

"That's what tipped the offer," says Henry.  "We're going to take a second honeymoon in Europe."  (Source: Thursday's New York Post Article, while I was eating a kick-ass breakfast)

Sounds ripe, doesn't it?  You can make up your own mind on what you think (if anything) about such a matter.  Sounds to me like somebody is quasi-indirectly paying for business, kind of like when you refer this person to that person and they pay for your cell phone bill, your car loan, your implants, and make a contribution to your potential alimony.  Mafioso gone Corporate, or Corporate already being a tad Mafioso?  Okay, maybe that's being a bit over the top ... or is it?

So, it has been decided that to improve my particular business, I will enhance the "perks" of doing business with me.

Every Mortgage Application that turns into a closed loan that I receive (in full)* before 2010 will result in yours truly giving the applicant a full back massage, a peek at my esteemed Baseball Card Collection, a unique insight into the Kennedy Assassination, and two samples of Aveda bar soap.  And if that's not enough, I'll tattoo your name on my ass if you fit the fit the bill.

Or, I guess I could earn business the boring way ... giving folks the best products I have and the best service that only I can provide.  But who wants that?  Dance with danger...

*  A full application entails you and I filling out a full 1003 Application, collecting all supporting documentation that is necessary, and taking blood and hair samples as we need them.  There is little in the way of a guarantee that you will qualify for said services, but it rarely hurts to ask.  Please visit appropriate guidelines and fine print to see if you qualify for such services.  Oh, come on, you have to love fine print.

A young gentlemen was pre-approved.  While a small loan, it is significant for him since it is the very first house he has ever bought.  The closing date is on the back end of November's Ides...

The supporting documentation was collected and the appraisal was ordered, yet over the weekend, he spoke to the Family Attorney.  Mr. Attorney recommended that he shop around.  Alas, the chap was "approved" at a local bank at an interest rate that was about a half percent lower than we quoted.  So, he went that way.

Days later, meaning today, it so happens that the local bank turned him down.  While getting into specifics may be a bad thing, they low-balled a legitamate rate they could offer him and their debt ratio requirements are tighter than an amateur porn star's balloon knot.  (No, you didn't just write that.  Yup, I did.)  They turned him down.

So, we are starting over to an extent.  The appraisal must be re-ordered and now we can actually send the file to Underwriting.

I'm a champion of folks shopping around, just not so late in the game.

The next time you shop, try the Family Attorney.

Easy answer, 60 days.  But I guess that depends on what kind of Pre-Approval you received or want for that matter.  Actually, the answer to such a question depends upon three factors:

-  You, as the consumer. 

-  The Buyer's Agent who is helping you find a home.

-  And the quality of the Pre-Approval you receive in the first place.

Ten Seconds, GO - You're interested in buying a home.  You even find a few that tickle your family bone.  But you need financing because you probably don't have the cash to buy it outright. Which leads to...

Nine Seconds - You're smart and seek out a Buyer's Agent to represent you. This will provide protection in your favor.  They represent you and only you. 

Eight Seconds - That agent may turn you onto a few folks like me who can help you out from the financing end.  And that doesn't mean you shouldn't shop on your own.  But buying a home isn't just about getting the lowest rate with no fees (an oxymoron if I've ever encountered one), it's about trust.  Interview those who express interest in earning your business and keeping it.  If they have the lowest rate with no fees, I can only hope they are in business when you need to do business again.

Seven Seconds- The Pre-Approval is more than just an application and credit check. There's some serious competency going on. They ask for your most recent pay-stubs, W-2's, bank statements, and the last time you had a wet dream about Richard Gere. 

Six Seconds - You find a house that you want to call home and a Sales Agreement has been signed and accepted by all parties. And there you are.

Five Seconds- You're hopefully just padding the documentation that you've already given to the Mortgage Company you choose.  I recommend Sardi Mortgage Inc, who isn't licensed just yet ... but when you hear Sardi, that should mean something. I'm not sure what, but it means something. Maybe it just means that there is an individual who is all over your particular file like white on puss.

Four Seconds - Appraisal is ordered and done. The rest of your file is pretty complete because everyone got along and did what needed to be done.

Three Seconds -  The complete transaction goes into Underwriting, those dastardly folks we think of who hate closing loans.  I'll give you a bit of info here, and I usually don't stick up for Underwriters.  They only get paid when folks close loans.  Without us, there is no them.  So, that's that.  In business, there's more to it than that, but that is a pretty accurate description.

Two Seconds - You are CLEAR TO CLOSE.  If there were three words that were magical in this industry, those are they. 

One Second Left - It's a proclamation of your destination.  You hit home!

And when there's no time left, that's the perfect time to be imperfect.  And that's the perfect way NOT to close.

Jason Sardi

Mortgage Consultant

610-653-0317

jsardi@ihmci.com

Tired of extending Sales Contracts?

Disgruntled because of bait and switch interest rate and fees?

Trepid because of the surprises that pop up like a flaring zit in your teenage years?

Fed up with never getting a phone call or email back in a timely manner?

We hear you here at Sardi Mortgage, Inc.  Now, while Sardi Mortgage, Inc isn't an actual operation... it is an actual human being.  I breathe air.  I breathe smoke (I know should quit, Mom).  And I breathe what's best for anyone who takes a chance on a guy like me.

Let me tell a story and I'll try to make it brief.  I read too many posts bloviating about this and that and never really saying anything.  I don't desire this to be one of them.

About two months ago I had a return customer come to me with a two-fold question.  The first one dealt with wanting to refinance his loan into a shorter term and lower interest rate.  The second was an inquiry about his friend who wanted to buy a home but wasn't quite prepared to do it in the there and now.  I'd like to concentrate on the latter, since the former is now in the books.

His friend has great credit, solid & stable income, and a rental history (with copies of canceled checks - take note renters) that is pure gold.  However, they are paycheck to paycheck kind of people right now.  Now, I know nobody out there reading this can identify with such, but this was their stumbling block.  Because of the area they wanted to buy in, they didn't qualify for the 100% USDA Loan.  Because they never served in the Armed Forces, they didn't qualify for the 100% VA Loan.  So they had to come up with a down payment.

Outside of the two products mentioned in the paragraph above, 3.5% is the lowest downpayment on the streets right now.  It can even be gifted from a relative.  But this guy doesn't have a relative with the capacity to help him with such matters.  So, he had to save it up along his way.  And along his way, he was surrounded by many people who were also dealing with buying a home, refinancing a home, and inquiring about everything between.  He got scared of the process and rightfully so.

I was asked a question that I'd never been asked in eight years of doing this gig.  He asked me, "How can I be sure that my loan will really close?  There seems to be so many horror stories out there, even if the loan does close.  Can you promise me that I won't have to deal with that when I'm dealing with you?"

I had to pause at that point.  Let's face it, I'm only as good as the company I work for and with.  While I can do everything right on the front end, I DO have to rely on others to do the same on the back end... ensuring a smooth sail to the table where ink dries.

I answered his question.  Do you want to take a guess as to how I answered it?  Well, I told him I couldn't promise such things.  I told him I can only promise ME and My Committment to anybody I deal with.  It's a war out there.  And I'm a soldier you can either hire or fire in these battles.  Like a good car salesman, I should mention that I look dapper in fatigues.  Like a bad car salesman, I rarely wear boots or underwear.

And it's reason #142 why I want to obtain the capital to start Sardi Mortgage, Inc.  Common Sense Lending is an oxymoron these days.  Oh, did I mention that the 'Inc.' doesn't stand for Incorporation, but Inclusion into the strange world of Common Sense Lending?  Well, I just did.

• I loathe the HVCC - some prick from New York wanted to throw around his power and make this the rule of law.  I'd take him to Judge Judy, but I'm way too busy watching Jerry Springer.
• 45 days to Settlement?  Okay, that's fine.  But two weeks in Underwriting is not.  Especially if you are a small firm in the big picture.  You either need more Underwriters or a better one.
• Regulate us all you want as to how much money we can make on a loan, just be prepared to do so consistently... and that includes your compensation, at whatever position you hold wielding such legislative powers.
• If you really want to look out for the consumer, protect them by teaching credit and home lending in their early years in High School. 
• Well, there goes short and brief because I could go on for hours. Who knew??

I haven't yet been compensated by this blog.  If you would like to provide such honors, email me and I will be sure to let you know where to send the eventual bounced check.

On that day that they question to hire me, watch out!  Because if they don't, I will.

for the credits, click here:)

A faded bush did appear, thick in foliage to any seer.  It won't quite disappear, that foliage that I no longer fear.

      ~Gunther Moses~

If you think buying a home can be scary, try renting a house.  We hear stories daily on the obstacles present when buying and then closing on a home.  The fact is that once you own it, you freaking own it.  You own its troubles, its grace, its everything... for the most part, it's your place.  But if you are renting it ...

There's a little story I'd like to share.  The participants are Lee & Shannon.  They rented their house for five years.  During that time, their Landlord seemed difficult, if not totally obnoxious.  If something went wrong with the house, phone calls went ignored and any communication from said party seemed obsolete.  However, when the rent was due, that Landlord was always available.  And 'he would get back to them in a few days' concerning any problems with the house.  Of course that 'few days' turned into the next month when rent was due.  Yet again, the rent would be paid and the landlord skated around handling any problem with the living conditions.

Patterns persist.

Leaky facets, clogged drains, faulty electrical outlets, and a lack of hot water were only minor areas of inconvenience.  Luckily, Lee knew how to deal with most of that type of stuff.  But when the basement was flooded by a particularly feeble bout of rain and phone call after email after phone call to the Landlord went unanswered, the floodgates of change called their name.  When they got a letter from the Mortgage Company to start making their payments directly to them, that calling started to scream.

Home-ownership had been a dirty word to Lee & Shannon for quite sometime.  They had been content with renting.  Truth be told, they had owned one over 5 years back and were put into an adjustable rate mortgage at the time.  While a nice option for some people, it didn't turn out that way for them.  It happened to be a treatment for buying over their heads.  Lee & Shannon got out and thankfully suffered no severe credit ramifications from the experience.  But they did suffer a very bad taste of what owning a home is all about.

With their rental situation in limbo, they opened all doors to make sure a roof was above their head.

From this front, they found a Mortgage Guy and I forget his name... though I remember the last name rhymed with 'Party'. ;)  They compared the cost to rent vs. the cost to own in the price range of their particular area and financial ability to afford such.  Not surprisingly, the numbers weren't so different.  In fact, with lower home prices and interest rates to write your Aunt Susie about, it turned out that buying a home would be a cheaper expedition... at least in regards to monthly payment.  Sure, leaky facets, clogged drains, faulty electrical outlets, and a lack of hot water could become an issue down the road, yet a Home Inspection intertwined with Lee's ability to deal with such things left a better taste of what owning a home could become.

They closed on their home on November 30th, 2009. 

Oh the glory, the romance of that day.  A fear arrived and was dead upon display.  It didn't take a smile, nor new-born tear, yet for the rest of the story... you may want to click here.

      ~Gunther Moses~

In case you don't recognize the relatively blooming bald (yet still somewhat subtle) patch on that young gent standing in front of the sign, it's me.  The place where I spent twenty-two years of my existence here on Planet Earth is a place called Clarion, Pennsylvania.  One of my best memories is that of a business that is still thriving and somewhat of a legend in many circles.  "Eddie's Dogs" is what we call it.  Bar-none, the best hot-dogs on earth, and I've attended a Harlem Globetrotter game in my life.

Eddie is the owner and should be proud.  In college, we probably gave him more crap than your local plumber can handle.  But damn if he doesn't make the most fantastic hot-dogs around.  And he has a pretty good sense of humor for a guy who looks like the Crypt Keeper never heard of moisturizer.

When attending back-to-back family reunions in my first visit to Clarion in years, we stopped by this legendary institution.  It really wasn't churning in my head that we'd be stopping at Eddie's.  I was there to help celebrate a monumental moment in my Aunt's Life and introduce the family to something other than a blow-up doll. 

And then we passed Eddie's.  At one point, he had two locations... one in Clarion (right across from a bar that was very popular among the college folks) and one that is shown in these pictures, which is the only operating one right now.  My only assumption is that he shut the other one down because it isn't exactly easy for a 195 year old gent to deal with a bunch of dumb smucks like me... let alone the Frat Boys.

All stupid analogies and restless attempts at humor aside, the guy took what he did and does for a living and made it into something pretty special.  If you want the best hot dogs in the land, visit him. 

As far as the sunsets and other memories, well, some things you just keep to yourself.  But they are good ones, none the less.

The most articulate version of the author's reaction to his first Taco Dog...

The one thing I find missing from our Capitalistic Climate lies within the very title of this post.  I deal with the lack of grace all the time and am damn sure I'm not the only one.  Too many instances arise when you help folks, guide folks, try and point them in the right direction, and all of the sudden they disappear.  Without notice, without a word.

Click here.

Perhaps they found a better deal. Can't win them all.  I'm cool with that.  That's competition and I don't fancy myself Rocky Marciano just yet. 

It puzzles me and makes me understand the "churn & burn" attitude so many sales folks have.  Get them in, get them out.  It's more of a one night stand than a relationship. Maybe that's the way it should be done?

But I disagree, especially when it comes to something like, I don't know, your house for example.  Do you really want to be sharing the sheets with Bill Maher when you can dance with Jon Stewart?  Mysterious analogies aside, I want to be advised by someone who holds some semblance of trust and credibility with me. 

I ran into a 'Rate Shopper' a few months ago and we've been in constant contact since.  His decision on which Lending Entity to choose came down to three. I was one of them. When he made his decision, it was based upon my fees being higher than the competitor and that competitor happened to be the Mortgage Company he had already dealt with. He sent me a pleasant email articulating his decision. I was quite shocked!  Not because of his decision per se, but because he took the time to let me know.  My response back was a grateful message thanking him for doing what so few do. His response verbatim is as follows:

"You're very welcome, Jason.  I felt that I owed you that in light of your helpfulness.  As someone who's essentially a missionary (financially), I raise all my support, and get frustrated when people don't have the thoughtfulness and/or courage to let me know they're not going to support us (or stop doing that). 

In any event, thanks for your kind words.  That means a lot to me, too.

Grace to you,
Bryan"

I'll take Bryan as a prospective client any day of the week, even though I didn't earn a dime in my communications with him.  He earned a reputation with me.  I think I did the same with him.  Reputation turns into relationships.  And while almost every relationship I've heard of has rocky roads to travel, that's the way to do business the right way.  At least until I find a goldmine under those covers with Bill Maher.

Smart Sales translate into closed deals.  Smart Sales is also ensuring it's a long term gig and not a short-term (and often perceived) fortune.

First let me preface (one of my all-time favorite words) this with a cold reality in the Lending Atmosphere right now:

• Nothing is easy.  I'm pretty lucky in that I have access to the ears and experiences of Lending Folks all over this Country, not just locally.  It's across the board.  Get on the gloves and realize that the days of two or three round fights are no longer the norm.  It will take a war of sorts, to survive & thrive out there.  Call it more Muhammad Ali/Joe Frazier than Mike Tyson/Michael Spinks.

I was more than shocked when I heard stories from various Retail Stores that are having trouble hiring.  I mean, we aren't exactly in the 'Best of Times' economically.  Are people not applying?  Are they instead spending $39.95 to learn the secrets to making millions while doing butt slides across their marble floors as money rolls in from that 'Best Kept Secret Nobody Knows About'?  Hey, maybe they looked up something online and realized they had a Rich Uncle in Rwanda and that lost fortune was now theirs?

Sadly, I suppose, none of that was the case.  It seems many Retail Stores require you to have perfect credit to get hired.  Let's call perfect credit 760 just for poops and grins.  850 is actually the number, depending upon the reporting agencies, but if you are over 740, you can probably give most White House Employees a lap dance and get paid for it.  Well, now I understand why they're having a bit of trouble hiring.

Before I ever got into FHA Lending, most of the business I did was Conventional... and some was the infamous Sub-Prime.  Those Conventional Folks had scores in the 700's most of the time and that was what I was used to dealing with.  Color me more surprised than when I learned that in this day and age, you need a 760 score at some of these places to make $10.00 an hour selling moisturizer obtained from a frog's lip:) 

It reminded me that while nothing seems easy in obtaining financing these days, we are still a bit more lenient and the outcome can be a whole lot more rewarding.  Sorry, but long-term homeownership eclipses looking like Joan Rivers for a hot moment.

Standard FHA Loans with most investors require a Credit Score of 620, no blood sample needed.

Conventional Loans, these days, are mostly a miss when it comes to payment/cost when your LTV is over 80% of the value/sales price of the property your financing.

While the process can be so convoluted and seemingly incompetent (when buying a home),... look at our freaking world!  Jimmy Fallon has a Talk Show!

Unless something changes and if you have a job, it's probably easier to qualify credit-wise to buy a home than work for a local Retail Store. 

Strange Days, Indeed.  Go out and buy a home with your 620 score.  Leave the Retail Stuff to the Credit Worthy;)

When it comes to mortgages, if you are like me, you are looking for the best price, lowest rate, and shortest travel between two points.  There is also one minor detail that you and I may have in common, it's called customer "freaking" service.  Looking for the straight line without much in the way of curves, kind of like Calvin Klein before his untimely demise.  Nevermind, he is still alive.  And if those curves arrive, which is a decent wager in this atmosphere, you probably want someone to stay and inform you every step of the way.  Perhaps I'm projecting, but still...

I've been wearing the title of Loan Officer for the better part of eight (going on nine) years now.  I've loved it and I've hated it.  Still feel both to this day.  But what strikes me as the curious sort, why do you chose that entity you choose?

I quote rates on Zillow and firmly believe some of the stuff I'm competing with is a joke.  It seems folks want to be baited initially with the 'deal of the day', as much as they detest being switched to 'the reality of it all' by the time the transaction is over.  Hey, I could be wrong but I find it highly unlikely (back to back adverbs, love it:) that the person quoting you the costs and profit (low-balling, mind you) cares much on how it turns out... as long as it closes.  It's volume driven.  It's getting the phones to ring.  It's getting the inbox on the email to have more inquiring messages.

While I hate to perpetuate any pessimistic view of the Mortgage Industry, especially in times where that seems status quo, I dare say that some of my predecessors are more John Gotti than they are Jesus Christ.  More profit than prophet.  Personally, I'd like to be a whole lot more like Jesus.  I especially respect his hairline.

If you are shopping for a mortgage, whether it be to buy or refinance a home, don't do it on price alone.  Especially not now.  Price Warfare in a Service Industry is probably going to mean you are going to get screwed Jenna Jameson style in the end. 

While I don't mind porn, it doesn't belong in Real Estate.  Shopping service is shopping smart.  And you rarely get screwed.

I was posed with a not so unique question early on last Friday's morning.  It came from a rather astute prospective client who asked, "How do I make sure I get the best rate?"

The more I thought about it after initially answering the question, the more I wondered what was really the right answer?  Heck, was he looking for the cheapest deal or the best deal, they are not always one in the same?  Was he looking for trust or smoke & mirrors?   He's a quality borrower by lending standards, yet seems to have fallen into a similar box of shoppers who have made life difficult for themselves and us by shopping on fees and rate alone. 

Devil's advocate may say, "Is this trying to substantiate ridiculous fees and a higher than market rate to pad your pocket book?" 

Devil's nightmare says, "Not at all.  Sales is volume driven, word of mouth, not getting ‘rich' off of one transaction, but making coin because you do many of them.  And I believe if you do it right, there's an education/consultation factor that just may be priceless for those who chose to work with you.  That kind of stuff saves them money, even though the Good Faith Estimate isn't the cheapest they've seen and the rate quoted is the lowest they've heard"

And he's still on that fence, which might make me a less than stellar sales guy.  Which also puts me on par with most folks who tend to be less than stellar shoppers.  My job, in part, is to consult folks on what to do and when to do it, in regards to anything involving Mortgage Financing.

Fair enough...

If you are in the position to obtain financing to purchase a home and have the desire/need/want to do just that, get off that little picket fence.  It may be electric when you look forward to see it behind you.  What does that mean?

Rates will go up.  I'm pretty sure of that.   More than likely, sooner rather than later.  The historical low we've seen has got to inevitably come to an end.  The Tax Credit thing, well, it ends soon as well.  And the inventory of homes on the market at prices more appealing than Selma Hayek in white stockings, will eventually reach a happy medium and go away. It will no longer be a Buyer's Market, at least like it is right now.

To answer the young man's question of how one can get the lowest interest rate possible, it's not always by shopping around.  While that's a starting point, this isn't a flea market.  This is probably one of the most important transactions that gentlemen will undertake.    

In retrospect, I should of answered his question with a somewhat different retort.  He is looking for the best rate and talking to me at 7:56 AM on a Friday Morning.  I think he just found it.