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 closed a loan that was one for the books! When I first met with the client, he was very open about some of his previous experiences when he bought his first home and when trying to refinance a few years ago. He had a few choice words to say about the handful of other companies that he used. What stood out most in all the conversations we had was when he said, “I don’t want any surprises.”
I actually appreciate when clients tell me about their previous experiences (good or bad), and I openly engage in dialogue as to what their biggest priorities are in obtaining this mortgage. Yes, everyone wants the lower rate on a refinance, or they want to buy the home without issue on a purchase; and of course, everyone wants the most economical rates with minimal fees – but when I ask about what they are trying to accomplish outside of that, I mean as to their long-term and short-term financial considerations. For example, there is no sense in paying a “premium” for a 30-year fixed rate, if the buyers know they will only be living in the house for certain for 3 to 5 years. There are many other similar examples along those lines.
In this particular example, he was very concerned about “no surprises” when it came to every aspect of the mortgage, including the fees and the timeline for getting the approval and closing. I quickly learned that I was not his first call when trying to get a mortgage for this home purchase. He unsuccessfully went to another mortgage company but for whatever reason, he left them to seek an alternative solution. When it comes to fees and rates, I know that not only are we competitive and under-market, but we never exceed what we say, in fact, more often we are lower than initial projections. In that regard, I wasn’t worried about any surprises there.
As to the timeline, although his contract was executed four weeks prior to him contacting me, we still had 14 days to get the mortgage commitment, which seemed like more than enough time given his situation. The sellers and their representation were extremely anxious given the delays, so there was no margin of error in getting them the approval quickly. He came to my office late in the evening one day to drop off all of the paperwork, and we were off to the races.
Well, the first “surprise” came when we got back the appraisal report, and it was $15,000 different than the amount we were expecting. I quickly found out that there were some heated negotiations and the sellers agreed to lower the price. Apparently, my client didn’t notify me or even his attorney for that matter, so we swiftly had to scramble to adjust our documentation accordingly. Everything was back on track, but we were having a hard time verifying his employment. As not to worry him, we tried aggressively to get that confirmation but were unsuccessful. “Oh yeah, I switched companies,” was the reply email that I got when I told him about our challenge in confirming employment.
After redoing the loan application again and requesting the updated documentation to quickly confirm and verify employment, we were back on track. I proudly sent the confirmation of the formal mortgage commitment to my client two days before the deadline! The next morning, he called me to say “Wow, thank you so much – how difficult would it be to increase the loan amount by $4,000?” Nothing surprises me in this business, and I was happy to make the accommodation and the necessary changes. They also wanted to close five days early if possible. “Not a problem whatsoever, was my reply.” At closing, we all had a good laugh about the numerous “surprises” along the way from his end – and how impressed he was that we were able to accommodate them all.
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