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.

If I were to take a vote, I believe that the general consensus would be, outside of “good health,” “time” and “money” are the most important commodities in life. Yet, I am sure I am not alone when I say that so many of us are guilty of so much wasted time and so much wasted money – that very often cannot be accounted for. In life and in business, I see this first hand and it happens all too frequently.

A few months back, I was contacted by a potential client who was looking to buy his first house. I went through all the information and necessary paperwork and scheduled a follow-up call with him and his wife to complete the pre-approval process. A few hours later, I received a follow-up call from him asking me about our rates, and to itemize “exactly what our fees would be to complete the loan.” This, of course, is a common request, and I went on to explain in great detail about ALL of the closing costs that will be charged by us as the bank, as well as some of the other third-party fees that he should expect at closing related to the property, title, legal and closing fees. I also explained that without actually having a specific house in mind, these fees were subject to change, and some of these items would be higher or lower depending on the purchase price and mortgage amount obtained.

I heard him whispering something under his breath, but I didn’t make anything of it. Specific to the rate, I mentioned interest rates can and often do change on a daily basis. I felt like he was more concerned with getting an actual number out of me than understanding how, when, or why that number would change. I told him that without getting the appropriate paperwork that we discussed on the previous call, and without pulling his credit, that I wouldn’t be able to give him a “real rate quote.” I said if he wanted to have a number “just to have a number,” I would do that. I offered him a rate based on that day’s pricing, and the assumption that his loan qualification was “average.” I reiterated that once I received his paperwork, I would be able to give him a formal rate quote and that I am sure based on what he is suggesting to me that the rates would be better. “I would rather error on the side of being conservative,” I added.

I followed up a few days later with them but did not hear back. The person who referred the client to me asked if I had heard from them and I said no. I literally followed up every two days thereafter for almost a month until I received an email telling me that they want to put the application on hold for now. Naturally, I replied that it’s not a problem and I was available if and when they continued their home pursuits and wanted to utilize my services. That was at the end of December.

Last week I received an email from the wife saying that they needed to “move fast” on a house that they want to put in an offer. She sent me all the paperwork that I initially requested in a matter of minutes. It was very organized. Too organized. I didn’t say anything but had my suspicions as to what that meant. I pulled their credit and what would you know – on their credit report was an inquiry from a bank from December. When I asked them what happened with Bank “X,” the husband timidly said “it was a mistake to go with them, and not you.” I candidly asked why they decided to go with the other bank, and he said that their “Rate Quote” was lower when he was “shopping” and comparing us to them.

He further went on to tell me that he had to take several days off of work to meet with this loan rep at the bank and provide all of the abundances of paperwork that they kept requesting. In the end, their rate was higher than the initial quote they offered because naturally all of the information changed from the initial conversation. He also mentioned that the bank never told him about any fees other than those to be paid to the bank, and he, therefore, felt that my fees – which included the third-party services – made our quote less favorable. He realized that the waste of effort, the lack of guidance, and the inexperience of the loan officer weren’t worth the time or money. When we went through the comparison line-by-line he realized that our offer was better across the board. We expect his approval in the next few days, and I in the end, I expect the terms to be even better than I promised.

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