The Seven Real Estate Stages of the Pandemic

By now, some of us have lost a loved one, friend or community member to COVID-19.  Though if the cavalier denialism exhibited by some Americans is an indicator, there are still many who have yet to share the magnitude of such a loss.  But even putting one’s head in the sand about the medical realities of the coronavirus cannot spare us the social, emotional and economic impacts. 

It’s accepted as true that though we all grieve a loss, everyone grieves in a unique manner.  One of the most referenced works on the topic was written in 1969 by Swiss-American psychiatrist Elisabeth Kubler-Ross, in her book On Death and Dying. This philosophy is popularly referred to as the “stages of grief,” and whether comprised of five emotions or seven, it feels increasingly as though we are traveling through ‘stages of the pandemic’ in both our professional and personal lives.  Sometimes we mourn the loss of our “past life” in a linear fashion and sometimes we jump along the steps chaotically, but without a doubt we have been presented with an event that has impacted our world and is in the process of shaping our future.  If I think back to February or March, and reflect on today, here are some examples from my journey through the stages: 

1) Shock and disbelief

Wait, no broker tours, no showing of property?  Here we go again a la Lehman, 2008 or 9/11 — investors leaving the market and loan programs being suspended or canceled.  Tremendous rate chaos.  

2) Denial

No way they will shut businesses down — that’s crazy.  What do you mean the kids are not going to go to school?  The Junior Warriors basketball season is canceled?

3) Guilt

I should have been more forceful with our clients who were on the fence.  How did we get lulled into complacency with credit availability?  Why did we let our guard down and not consider existential risks in our assessments of the market?  

4) Anger and bargaining

Why are we, here in CA, subject to shelter-in-place while people in other parts of the country are still conducting business as usual?  What do these “health experts” really know?  Man, I HATE Zoom meetings!

5) Depression/loneliness/reflection

My 85-year old dad is 2000 miles away and I’m not sure when he’ll see his grandson next.  I’m not going to see the inside of a bustling conference room for many months. Some of the skills, habits and personality traits I’ve used to build my business are going to be sidelined indefinitely.  Put the professional wardrobe in mothballs…

6) Reconstruction and working through

Yes, this is the landscape of our new reality — it is not temporary.  Embrace, learn and master the tools and tactics necessary to maintain momentum.  Contemplate what it will take to grow in a remote world.  Reinvest marketing dollars accordingly.   Rethink all iterations of “it’s just the way we do things.”

7) Acceptance and hope

The way we did business is over.  What remnants exist are gifts but my mindset must accept that I am in a foreign country now and I need to first learn and then speak their language.  I can still think in my native tongue, but the longer I hold out and do so, the more difficult it will be to assimilate.  The sooner I embrace the good and bad of the new culture, the sooner I will be open to its wonders.

Months into the COVID-19 pandemic, I can find myself cycling through several or even all of the above stages on any given day.  My guess is that most others do as well — unless they are stuck.  Maybe they’re stuck in denial.  Maybe they’re still pissed off — at their governor, at their clients, at themselves. Then again, maybe some are well on their way of reconstructing their businesses but  require help they never previously needed; with new technology, with new tools, with new ideas.  My point is that we have all lost a loved one — our pre-pandemic way of life and business.  It’s now up to us to move on, yet before we do we must confront the grieving process.  Recognizing that is part of a healthy healing process too.

In loving memory,

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

1984

Look, I realize I should be so lucky to think that someone from the Van Halen camp is going to bust me on a copyright infringement for using the image above.  So if they come a calling, this is what I would tell them:

I originally wrote this blog post on the 34th anniversary of the release of Van Halen’s 1984 “album.”  I was a dark-skinned, plenty-awkward eighth-grader settling in for a long Illinois winter.  With no discernible basketball talent, no academic prowess and eliciting zero interest from the cute, middle-America girls who hailed from the Arrowhead subdivision and peopled the halls of our junior high, the basement my Dad built out for us threatened to be a pain cave of epic boredom proportions for at least the foreseeable future.  That is, were it not for the crackle of the phonograph needle that succumbed to the majestic OBX polyphonic synthesizer swells of “1984.”  Like watching sunrise over the Earth from outer space, that short, haunting prelude to the massive hit “Jump,” would give way to the dawn of a different day for me.  

Most of us have a favorite “album,” and again I use this word in quotes because the format for delivering music has evolved so drastically over the years.  We can likely all name at least one collection of tunes that formed the audio backdrop for a trajectory change in our lives.  Even hearing just a snippet can hearken back to a summer on the beach, an old flame, or the very essence of our youth.

Coming of age for most of us is a painful metamorphosis cocooned somewhere in the silk of our teenage years.  But for me, the strains of 1984 literally reached out of my boombox and put an electric guitar in my hands.  Then, having summarily equipped me for my calling, those nine songs transformed me, for the very first time, into an autodidact and demonstrated that a dream is meant to be pursued with innocent, if infinitely energized, abandon.  No matter how crazy and audacious the goal, when you smell like teen spirit and have little to lose, it’s your once-in-a-lifetime opportunity to give it all you’ve got.  You may not end up emulating your hero note for note, but that matters a lot less than the amount of growth you’ll experience for strumming along — with enthusiasm, with passion and with purpose. 

Thanks to a career I now love in the mortgage business, I meet a lot of people.  As introductions go, I’ll get an occasional, “Are you from California?”  “Why no…,” I will answer, and often they’ll next ask how I found myself in beautiful Marin County, just north of San Francisco.  “Well, in the late ’80’s, I moved to L.A. to pursue a career as a rock guitar player, like Eddie Van Halen….”  Pause…..  “What???”

Since the album came out, I listen to the 1984 intro every year on my birthday.  First it was on vinyl, then cassette, then CD, then my shuffle and now just my phone.  Regardless, it re-centers me with a time and place that are gone, but with an optimism that will never die.  I would be willing to bet that most of us have a musical bond to that very pivotal moment in our lives when we became much of who we would be for the rest of our lives.  What’s yours?

Might as well jump!

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

Should I Keep Making My Mortgage Payment?

With so many people refinancing these days, and with the loan process sometimes crossing one or two months’ time, a question we frequently get from those in process is, “Should I keep making my mortgage payment?”  The answer is a simple and clear, “Yes!”  

But let’s talk about why, because the concept is as simple as it is often misunderstood.  In our formative financial years, many of us rented a home or apartment before we made the leap into home ownership.  And I’d be willing to be bet that more than a few of us got chased by a landlord about the rent being a few too many days late past first of the month.  Herein lies the mortgage payment dilemma when it comes to refinancing.  Unlike rent payments, which are due on the first of the month and cover the month ahead, mortgage payments are applied in arrears.  This means that you live in the house in August, for example, and you pay for that time (in interest and principal) on September 1.

Now let’s assume you’re refinancing a home and your expected close of escrow is the 10th of August.  Let’s also assume that you have not made the mortgage payment on the first of August.  Your mortgage has a grace period until the 15th of the month, after which you are assessed a 5% penalty.  But back to our closing scenario — the payoff demand on your existing loan, once received by escrow, will include all of the days of interest for July, plus the expected days of interest in August until the close date of the transaction.  Your new lender will collect prepaid interest from August 10 through August 31.  You will “skip” a September 1 payment altogether (no regular payment with either old or new servicer) and your first payment with the new loan will be due on October 1.  Got it?  OK, great.  But remember, on August 1 and into August AND until escrow closes, you are still responsible for your August payment!  If for some reason you don’t close on the 10th and there are delays past the 15th (where you’d incur a penalty) and, heaven forbid, delays past the end of the month where you’d report late to the credit bureaus, the responsibility to have made the August payment falls squarely on you.  

The best advice any of us can give on any mortgage transaction is to ALWAYS make your payment if you are unsure of how things will work out or if your lender or closing agent is not responsive or clear on the matter.  Until your new loan is funded and closed, you are ALWAYS responsible for making your mortgage payment and the risk of going 30 days late on your home loan is a risk too great to run.  Any overpayment, as painful as it might be, is far less damaging than the credit blemish of a missed payment.  If you have questions on any scenario, get in touch and we’ll be happy to explain further. 

The check is in the mail,

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

How Long Is a Pre-Approval Good For?

You’ve decided to make the leap and enter the real estate market as a buyer.  You’ve been looking at homes online, the temptation has become too strong and you realize it’s time to hit the street and actually start looking at properties.  Your Realtor almost immediately informs you that not only will she not participate in your search before she knows you’re pre-approved, but also that in this pandemic day and age, without a pre-approval letter no serious listing agent will even let you step foot in the home for a viewing.  And so you reach out to your preferred lender and you get pre-approved for a mortgage.  Now, how long will that preapproval be good for?

There are a few elements involved in the lifecycle of a pre-approval so let’s look at some of the ones that typically govern the validity of your profile and the day it may expire:

Credit Report

It’s safe to say that your credit report has a 90-day expiration.  Even in cases where a lender will permit 120 days, we have to assume that a purchase timeline might be 30 days.  Since it’s largely not in your control, you never want your credit report expiring while you’re in contract.  At some point between 75 and 90 days, credit expiration becomes a material factor.  Now, if the original credit pull has you with 800 FICO scores and you’ve done nothing that would jeopardize your strong credit rating, it’s highly unusual for your credit report to suddenly become an issue, but a re-pull is warranted if you think you may enter a non-contingent contract when you’re coming up on your expiration date.

Tax Filing Deadline

In 2020, the income tax filing deadline was July 15, but in most years, April 15 is the day by which you either need to file your tax returns or file an extension.  If your pre-approval did not include this year’s filing and you’ve since filed your return (including e-file), your pre-approval must be updated accordingly.

End of Year

During January and February, most of us get our W-2 forms, our 1099s, K-1s and other year-end statements of earnings.  All of these must be included in your file, so if your property search crosses the end of the year, your pre-approval would need to include the newly released information.

Life Events

If you get a new job, your hours on your current job are reduced or changed, if you get divorced, buy a new car, etc., all of these events could impact your pre-approval.  A good way to conceptualize your pre-approval would be to assume that anything that impacts your income, assets or credits could influence your mortgage application.  Let us know when these things happen and we’ll make the necessary adjustments.

Your mortgage pre-approval is always a work in progress until you go into contract.  We can make any necessary changes and advise on financial aspects in advance too.  We’re here to help and ultimately our goal is to build and maintain and strong and ready file so that you have the best chance of winning your offer.  We need your help to do that and we, in the industry, can all help by reminding you it’s not over until the keys are in your hands.

Best if used before,

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

Expertise Unmasked

A couple of years ago, we found a home we really loved.  The market was competitive at the time, but we choked on the list price and thought about going in a bit under it.  Our Realtor, someone recommended to us, someone possessing a proven track record in the community and someone garnering much respect among fellow agents, highly advised against lowballing the offer.  Eventually, we bid a little over list and got the home.  One of the reasons the home was so desirable was the school district.  The teachers, overall, have a tremendous reputation and years of experience that just seem to best position the student body to learn in a great environment, test well and excel later on as they go to high school and college.

Back to buying, when we consulted one of the county’s top-rated mortgage professionals about locking the interest rate on our loan, he urged that we get things nailed down and not take needless chances.  With a 25-day escrow, he reminded us that there was not going to be much time to pray for a correction if the financial markets moved in the wrong direction and that we could really get burned by trying to control something over which we had no control.  Personally, we thought rates might go lower so we were tempted to float things a bit longer, but fortunately we took his advice and landed on our feet.  Oddly enough, the financial markets got detrimentally volatile about a week into our escrow, though thankfully we were spared that agony.

The new home needed some work, so we eventually hired a contractor that our neighbors referred with honors.  We also decided to kick out the garage to fit a third car.  The contracting firm suggested that we replace the aging and failing sewer lateral before pouring the new footprint, since the line ran under it.  While this would be a short-term financial hit, it would save us a ton in the long run and it proved to be a smart move, as some of the new appliances would also require more efficient capacity in the plumbing.  So the forethought and competency of our contractor proved to be a smart investment all the way around.

In the new garage, we keep a car that we mostly use when we go into the mountains and on road trips.  We’re lucky to have a great mechanic who helps us keep the vehicle in reliable running order.  If the brakes, belts or fluids need replacing, he gives us good advice and advance notice on replacement and this has always served us well.  Yeah, I’ve tried to DIY some car repairs but I have to admit, they have the tools and techniques that promote a far better result.  Plus, they can do in two hours what takes me six, and without the busted up knuckles and epic tirades of profanity characteristic of my home projects.

When we hit the hills, we love to fish in mountain streams and are grateful to have a local tackle shop that keeps our gear in top shape.  Now I’ll admit we’re a bit of gear junkies ourselves, but these guys know angling hook, line and sinker.  The only tough part is that we can’t get out of the store without dropping a few hundred bucks each time we go in.  Come to think of it, that’s not the only tough part — every time I step foot in that door I usually fritter away a couple of hours talking the joy of fishing.  They are like human encyclopedias.  But I guess if you don’t appreciate the finest nuances of the sport, you wouldn’t get it.

Back in March, though, this COVID-19 pandemic thing really threw a wrench in the works and now I feel like we’re trapped in our home and being oppressed by these officious elected officials and misled by the hysterical mass media.  These high-minded epidemiologists, virologists, medical professionals and so-called “experts” are telling me I have to wear a mask, I have to avoid indoor gatherings, and I should keep physical distance in public.  Well, I’m not gonna do it.  I’ll follow my instincts and set my own guidelines and they can just leave me alone.  I mean, seriously!  Who the hell do these doctors, with their fancy degrees, hours of residency and years of experience think they are?  I know better than the experts — in fact, you give me a choice between my gut and their brains and I’ll choose my gut every time.  I’m smart and I know what the facts are and besides, if I want to learn about something, I can just read about it on the internet or tune into my favorite network and get their opinions.  Experience and expertise are overrated and I can see right through that mask. Especially with matters of life and death.

Live and let die,

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

How Long Does It Take to Get Pre-Approved?

Many real estate markets in California move fast, but it’s been this way for years.  When a hot property hits, perhaps there’s a showing on Sunday (more on that in a bit, and in the context of COVID-19) and then offers are due on Tuesday, with some buyers scrambling to make a preemptive offer, if possible.

This reality can run counter to some buyers’ inclinations to get their mortgage financing in order by dipping one toe in the water at a time.  It’s not uncommon for us to get a call that starts something like this:  “My partner and I are thinking about buying a home in the next 3 to 6 months, but we’re first-time buyers and not really sure where to start.  We were told by our real estate agent that we need to get pre-approved and might have some time over the next few weeks to look into this.  Can you help us get started?”  It’s also not terribly unlikely that a house will pop up that grabs these prospects by the heartstrings.  Before we know it, there will be a successive call that goes something like this:  “OMG!  We just saw the perfect home!  Offers are due tomorrow at noon!  What do we need to do to get pre-approved right now?”

So the real question here is, how long does it take to get pre-approved for a mortgage?  Of course, the answer will vary from one borrower to the next.  Some scenarios are quite simple — both borrowers get a W-2, have funds for their down payment in one account and have squeaky clean credit.  Others are massively complex — self-employment, multiple rental properties or entities owned, RSU or other variable income, a credit hiccup in the past, etc.  But at the end of the day, the single biggest factor determine the speed in which we can “decision” a pre-approval and get a buyer into the game comes down to the borrower’s organizational skills.  In other words, if any borrower(s) can complete a thorough and accurate application, then bear down and get us complete documentation for their income, assets and credit, usually and irrespective of complexity, we are almost always able to turn a pre-approval in under 24 hours.  Often, under six hours.  Right now, due to the pandemic, you may not even be able to view a property without a pre-approval letter in hand, so we are seeing a resurgence in interest for pre-approvals on short notice.  

The process and steps for pre-approval generally follow this pattern, and there is no cost or obligation associated with making an application:

  1. We always welcome an initial call to discuss objectives and answer questions.  Call any time!
  2. Our digital mortgage application is one of the industry’s best.  You can complete this user-friendly form in 10 to 15 minutes and whenever convenient.  It is best to tackle the application from a place where you have access to your financial documents so that you can assure accuracy, but even if this is not possible, some will complete the application from their smartphones with perfectly efficient results.
  3. Upon completion of your application, you’ll be prompted to securely upload your financial documents such as paystubs, bank statements, tax returns, etc.  While you can skip this step at this phase, consistent with our theme above if you are able to provide complete documentation, we are able to return a decision with less delay.
  4. We will follow up with you to review your information and issue a pre-approval letter for your search.

If you are “in the market” and your market is in motion, timing to pre-approval should not be a concern.  Yes, if you are able to start and complete the preapproval process without urgency, that’s helpful but not necessary.  We get how the housing market works and we understand what needs to happen when an opportunity arises or materializes.  Let us know when you need our assistance!

Point and shoot,

Rob Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

Pride

My most formative years were spent in the suburban Chicago-land area.  Our subdivision was an island among sea of cornfields.  The high school from which I graduated in the late ’80’s would have won no awards for diversity.  And if, at that time, you were my age and knew your sexual orientation was anything other than straight, you probably kept it to yourself.  The three-letter slur we freely bandied about at that time to denigrate homosexuality is harsh enough now that if I hear it, I cringe. 

As fate would have it, in my late teens, I moved out to Hollywood to pursue a career in music and it didn’t take long until I was exposed to others who were lesbian, gay, bisexual, transgender and who also happened to be wonderful people.  They were my co-workers and my friends.  They were damned talented musicians and artists and in the blink of an eye, I was forced to see the world very differently.

Just over my lifetime, I can observe and marvel at the increased ability by which LGBTQ individuals are able to express their sexual orientation.  Like with other efforts to expand human rights, equality, dignity and freedom, we are far from perfect.  But we have made unmistakable progress and many minds have opened.  We have had openly gay politicians and legal gay marriage in many states, including California.  And this trend shows, thankfully and with my full support, no intention of slowing down.  I will never imply to my young son that any discrimination against race, religion, sexual orientation or other cannot be lessened and, hopefully, eradicated over the course of his lifetime.  We know when the drum beats loud enough, when the water builds so high behind the dam, no army can stop an idea whose time has come, to quote Victor Hugo.  

I am not a member of the LGBTQ community myself, but I am out and proud to support their cause.  Our doors are open and we welcome them and their partners into our business.  We can offer not only great financial products and service, but a place where they will face absolutely no discrimination or prejudice and an overabundance of due confidentiality and privacy when and where required.  While I am optimistic enough about the future in our nation and our ability to pursue and prevail with equal rights for all, I am realistic enough to know it’s not OK to be silent about these matters any longer.  

With pride,

Rob Spinosa
Senior Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

Let Me Be Clear

As we go through life, I’d bet most of us come to a point where we realize we must be comfortable in our own skin.  Warts, blemishes, imperfections and all.  So as my career has progressed, I have had less difficulty ditching the pretense of needing to conceal the fact that I never attended college and accept that, in matters of business discourse, I was raised mostly with a blue collar approach of getting to the point. 

Yeah, I know I have been accused of possessing a certain facility with language that belies the high school diploma I struggled to achieve, so it won’t surprise you to know I make a consistent effort to build my vocabulary, my catalog of quotes and my storehouse of witticisms.  Still, I harbor a broad disdain for “corporate jargon.”  I bring this up because, working in the San Francisco Bay Area, with its proximity to Silicon Valley, most of my clientele has exposure to the sprawling tech campuses that employ the nation’s best and brightest.  So while the purpose of this post is not to make fun of anyone — especially not those whose intelligence far exceeds mine — if you’re going to work with me, I want you to know a few things:

  • I work in the mortgage industry, not the mortgage space.  This was an industry nearly 20 years ago when I took the leap of faith to become a full-time salesperson.  It’s still a vibrant industry today.  Let’s leave the space exploration to NASA.
  • I try not to leave any loops to close.  I do have a bias to action in order to get things done efficiently out of the gate.  Don’t put off to tomorrow that which you can finish today, right?
  • I’m not going to open my kimono and be fully transparent.  There, I said it.  I’m sorry, but I work for my buyers or homeowners.  I don’t reveal their information to other parties in the transaction in any feigned virtue of being completely transparent.  I will be honest 100% the time, but I will not be “transparent” to that degree.  This is business.
  • I never go “out of pocket.”  I don’t even know what that means.  Yes, sometimes I cannot be reached for good reasons, but when that is a possibility, I will try to provide instruction for my next in command.  Outside of those few occasions, I am probably one of the most responsive and accessible professionals in the mortgage space…I mean, industry.
  • I am not rate or program agnostic.  I have strong opinions and I will share them with you.  I will respect you if you agree or disagree with reason and tact.  The way I see it, you should expect a professional to share his/her experiences and perspective because that’s valuable insight built over a career.  And it’s exactly the kind if information from which a client — someone who may only transact a few real estate deals in his/her life — can benefit.
  • “Deep dives” are often bested by keeping things simple.  Even with a myriad of loan options, 95% of our clients end up with our Top 5 solutions.  That doesn’t mean that mortgage financing is simple, but it often means that wide and shallow works better for most.
  • I always have the bandwidth to provide great customer service.  You will never see me more aggravated than if a member of my team tells a client or prospect that “we are slammed.”  I have worked hard my whole career in order to be busy for the remainder of it.  If I have too much business, I have enough revenue to hire additional staff to assure you timely and competent service.

So that’s my rap.  As they say, it’s easy to make a simple thing complex and hard to make a complex thing simple, so in an effort to achieve greater clarity, I’m cool with ditching the Silicon Valley lingo when we work together.  Clear communication polls way high up on the customer satisfaction surveys all the time, and my career would look very different without the effort I make to deliver it to the street.  What about you?

Time to log off,

Rob Spinosa
Senior Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

Will My Property Taxes Go Up If I Refinance?

Because the current interest rate environment is so conducive to refinancing, a concern that some have about taking action stems from confusion related to how their property taxes are determined, and specifically the question, “Will refinancing cause my property taxes to go up?”  It goes without saying that nobody wants to save money via refinance, only to see it evaporate in the form of higher real estate taxes.  But is this a real threat?  Or is it safe to assume that simply by refinancing you would not see a change in your tax basis?

Our answer must first address, well, the address — of the home, that is.  Since I’m a licensed loan officer in the state of California, working out of an office in Marin County, I’m only going to view this topic through my designer sunglasses.  In California, properties are assessed to market value when they change ownership, and change of ownership does not typically happen in a refinance.  So if you purchased a home for $500,000 in 2015, and it appraises for $650,000 in 2020 when you obtain your refinance appraisal, the county assessor is still working off your original assessed value as far as your tax basis is concerned.  Behind the scenes is a more complex calculation that has to do with changes to the ad valorem portion of your tax bill, adjusted by the lesser of a 2% annual increase OR the rate of inflation, as dictated by Proposition 13.  If you have questions about how to interpret your tax bill, give me a call or send me an e-mail any time and we’ll review it together.  But again, the incremental adjustments to the original basis prevail here and not a jump to the appraised (or market) value at the time of refi.

“But wait!” you say.  “My tax bill really did go up when I last refinanced!”

OK — let’s look at this a little closer.  We know that a refinance alone would not usually trigger a reassessment, but are there some things that could cause a fluctuation in the amount of tax you’ve been paying?  At times in the past, and especially during the downturn in 2008 through 2012, some homes were eligible for a temporary reduction in tax rate.  Those will revert back to their regular basis with rising values, though this may seem disconnected and cause one to think the property tax rate has been reassessed.  But the most common culprit is an escrow account for taxes and insurance.  Adjustments by your loan’s servicer that are required to maintain a sufficient balance might show up as increases to your PITI payment.  Both of the above examples could have coincided with your refinance and they may have changed your tax payment amount, but they would not have been a result of the refinance itself.

I realize that property taxes are a significant component of your total monthly housing payment.  After all, I pay them too!  So if you’re thinking about refinancing to get into better terms or a lower payment, and you have been reluctant to do so because you feel a mortgage lender’s appraisal and process could trigger an increase in your property tax bill, you can step back from the ledge and take a deep breath.  Refinancing, in and of itself and the vast majority of the time, does not cause your property taxes to increase in California.

Eureka!  I have found it,

Rob Spinosa
Senior Vice President of Mortgage Lending
Guaranteed Rate
415.367.5959  Cell/Text
rob.spinosa@rate.com
NMLS:  22343

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960
East Bay Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283

How Hard Is It to Refinance a Mortgage?

On a weekend morning you wake up:

A)  Before 6AM.

B)  Before 8AM.

C)  Before 10AM.

D)  Yeah, yeah, I’m awake…

It’s time to take out the trash when:

A)  Pickup is the following day.

B)  The level of trash is approaching the top of the trash can.

B)  The level of trash has crossed the plane of the top of the trash can.

C)  Expert levels of jenga skill are required to balance your trash on the top of the steaming heap.

If you answered “D” to either of the above, and you have a mortgage in California, this blog post is dedicated to you.  You may be sitting on a pile of savings but are also concerned that refinancing your home loan may be too difficult or expensive, require tons of paperwork and inconvenience and may even end up in failure.  So let’s get serious about how to refinance your home here in 2020, even when the COVID-19 pandemic shows little signs of disappearing like a miracle.

What’s Involved?

If your only experience with the home finance process was getting a loan when you bought your home, you should find that the refinance process is far less stressful.  This is because you don’t have the ominous deadline requirements imposed by a purchase contract.  Time’s still of the essence — your rate lock is only valid for a specific period of time, but unlike with a purchase, if you run late, your earnest money deposit is not a risk.  I’ll generally ask a refinance prospect to send me a copy of a current mortgage statement and with that, I’ll do a complete analysis to determine if it even makes sense to refi.  This work up is free and has zero obligation.  If it makes sense to proceed, we’ll have a client fill out a digital mortgage application (if that is convenient) and then we’ll request the usual suspects as far as documentation is concerned; paystubs, bank statements and tax returns.  Often, the list is very manageable because we strive to reduce paperwork and variables at every turn.  We may even learn at this stage that the transaction does not require an appraisal.

What Does It Cost?

A typical refinance for a loan size ranging from $250,000 to $1,250,000 will usually cost between $3000 and $5000.  Sure there are ways to make these costs significantly higher or lower, but when you factor in the fundamentals; lender fees, title/escrow fees, prepaid interest, insurance, appraisal, etc., this is a reliable range for a “no point” refinance.  If an appraisal is required, it’s usually the only fee paid “up front.”  Most refinances will “roll” the closing costs into the new loan balance as well, and this prevents the borrower from having to write a check at close of escrow.  One can also choose to do a “no cost refinance” but the best fit for any client is always a math equation of financial objectives and available savings.  We are happy to help with this discussion.

How Do I Start?

Kicking off a conversation about a refinance involves no cost or obligation.  If you think you may have an opportunity to lower your rate, lower your payment, lower your interest payments over time, get cash out of your home or consolidate higher interest rate debt, get in touch.  It can’t hurt to learn about the options, but it can often help to act on them. Especially in the current, and historic low, interest rate environment.

You snooze you lose,

 

Rob Spinosa
Vice President of Mortgage Lending
Guaranteed Rate
NMLS: 22343
Cell/Text: 415-367-5959
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960
Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate’s Human Resources Department.

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood Chicago, IL 60613 – (866) 934-7283