Shmuel Shayowitz (NMLS#19871) is President and Chief Lending Officer at Approved Funding, a privately held local mortgage banker and direct lender. Shmuel has over two decades of industry experience, including licenses and certifications as a certified mortgage underwriter, residential review appraiser, licensed real estate agent, and direct FHA specialized underwriter. Shmuel provides a uniquely holistic approach to comprehensive real estate and financial matters that goes well beyond any single transaction. Shmuel is an award-winning financier recognized for maximizing the short-term and long-term objectives of his client. As a contributing writer to many local and regional newspapers and publications, his insights have been featured in the media for many topics, including mortgages, personal finance, appraisals, and real estate trends.
This week I experienced a situation the likes of which I don’t think has happened yet in my career. Although I am confident that the clients are not local and do not read this paper, I will, as I often do, change a few components of this otherwise true story. A real estate agent whom I have worked with in the past followed up with me about a client they referred to me a few weeks ago. This client was revisiting an offer on a house that they looked at weeks ago when I was introduced to them.
First, let’s rewind to a few weeks ago. We were introduced to a great couple anxiously looking to buy a house after being “in the market” for a very long time. These aspiring home buyers were already working with another mortgage company and had already obtained a pre-approval. The agent told me that they weren’t entirely “comfortable” with the other mortgage company, and rather than going back to update the qualification, they asked their Realtor for another recommendation.
At that point, we spent a few days gathering the information and necessary documentation so that we can try to pre-approve these buyers for this pending home. The pre-approval they obtained was for an “alternative” mortgage program, which we offered as well. I was excited because I know that for this program, we should be able to deliver even better rates and terms than what they were offered. After all of the analysis, we came back with the bad news that not only could we not “beat” the offer they had, but we couldn’t even pre-approve the situation in the first place.
To the credit of my colleague, he truly explored every option and every solution, but we could not offer anything compelling. We gave a counter-offer, assuming they put down another five percent of a down payment. They were not able to do that, and it only made sense for them to pursue their initial pre-approval and initial discussions with the other company.
Fast forward to earlier this week, I was surprised when the Realtor called me again and asked that we re-explore the situation on this home again. They wanted the house desperately. It was finally revealed to us that not only did this other mortgage company offer them a pre-approval on a deal that we could not perceive, but the buyers were charged close to $2,000 for that piece of paper.
The other mortgage guy was now demanding another fee for updating the pre-approval on the same house to update the offer. He also wouldn’t give them any assurances that their loan would be approved even after the pre-approval. Yes, you read that right. Again, we tried every which way to get it to work – and explored every alternative, but we could not come up with anything. They were being pressured by all parties to update their offer or they would lose the house. In the end, they lost the house, they lost the $2,000, and they lost faith in the entire home buying process.
I wish there were some dramatic ending where we once again ‘saved the day,’ but it was not so in this case. I cannot emphasize enough how important it is to work with highly reputable and highly recommended experts. For most, the mortgage and home buying process is already overwhelming and complicated – working with unreliable people can be very costly!
Shmuel Shayowitz (NMLS#19871) is President and Chief Lending Officer at Approved Funding, a privately held local mortgage banker and direct lender. Shmuel has over two decades of industry experience, including licenses and certifications as a certified mortgage underwriter, residential review appraiser, licensed real estate agent, and direct FHA specialized underwriter. Shmuel provides a uniquely holistic approach to comprehensive real estate and financial matters that goes well beyond any single transaction. Shmuel is an award-winning financier recognized for maximizing the short-term and long-term objectives of his client. As a contributing writer to many local and regional newspapers and publications, his insights have been featured in the media for many topics, including mortgages, personal finance, appraisals, and real estate trends.
