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.
Things are good, real good. Right? Just ask the market-makers. Home values and market appreciation are at record highs. Mortgage rates, while beginning to shift direction, are still at unparalleled lows. Inventory – meaning homes that are available for sale in the market are at depressed levels, pushing houses off the market at record speeds. The Stock Market continues to climb and shatter records on a weekly basis. The US deficit has expanded so much, people have stopped reckoning. Bitcoin, the cryptocurrency invented during the great recession by an unknown person or group of people, is at incomparable levels – breaking $50,000 earlier in the week. All in all, everywhere you turn, the markets are on fire, and people are still pouring gasoline on the flames.
I have been blessed to be a part of the real estate and mortgage worlds for over twenty years. It began during my college years – and my passion for helping people buy or finance their homes has only grown as I continue to push myself to master my craft. I say this not to impress anyone but to emphasize that I have “been around the block” and have seen a lot in this industry. That said, I have never seen the kind of environment that we are in right now. With all of the prodigious (yes Shimmy, prodigious) business happening now, the task of getting good financing has potentially never been more challenging. Before you tune out, assuming that I will be going into long-winded details of loan guidelines and underwriting qualifications – I assure you that I won’t. I am talking about the basic functions of the loan process. I will give you but two examples.
Let’s start with home values. A typical appraisal report on a single-family home costs approximately $500. For that money, an appraiser has to … chase down their payment, coordinate an appointment to inspect the house – while being mindful of COVID safety restrictions, draw meticulous diagrams of the home layout, measure every room in the house, take a batch of pictures – and of course, come back when it’s not snowing if need be, to get a good exterior photo, drive by the comparable sale homes and take pictures of those – without the homeowners giving them suspicious glares, reconcile the value, and submit the final appraisal report with a “fair market value” … all in an environment where prices are rapidly changing by the minute because people are overpaying by tens of thousands of dollars to get into a home. This is unsustainable and is already causing delays and issues with appraisers being hard-pressed like never before.
If that didn’t depict a riveting picture in the day and life of a real estate appraiser, let’s talk about the reality of dealing with anyone from a bank these days. Picture this, your loan is set to close, and you need a simple payoff letter from your current bank to calculate what is due. A majority of the existing mortgage holders today do not have automated systems in place to procure this request. That means hours of waiting on the phone to finally connect with someone – who is most likely working out of their home – and dealing with the monotonous chore of spitting out payoff letters to impatient callers, round the clock. Mind you, if their WIFI fades mid discussion, you have the privilege of doing it all over again. If the connection doesn’t drop, most likely, you will be told to fax in a request and wait 3-20 days for that payoff letter to show up, assuming they get your fax. That is a simple payoff letter. If the homeowner has a Home Equity Line of Credit, the real fun begins. To be continued… Happy Purim, hope you enjoyed my Purim rant.
To learn more about Shmuel Shayowitz, click here or complete this form to be connected with Shmuel: