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

What Are Credit Tradelines?

I think I’ve made it clear before that I find no shame in talking about how hard we work for our clients. My assistant, Jamie, and I see a good number of mortgage applications come across our desks every week and in 2019 and 2020, a high percentage of them have been for jumbo home loans, which means that our borrowers must demonstrate strong credit depth by way of an adequate number of tradelines on their credit report. Gone are the days when one could just have a decent FICO score in order to cross credit concerns off of the loan approval list.

When we talk about credit tradelines and credit depth, most of the prominent jumbo mortgage banks like to see recent credit activity (that is, use of credit and timely payment) to consider any account active. And that’s really what a “tradeline” is — an account. An individual tradeline might be a mortgage, an auto or student loan or a credit card. All are different types of “trades” but in the case of revolving debts like credit cards, use of those cards in the last year or two is what really brings the tradelines into active status and works to meet the jumbo lender’s requirements.  By far, the gold standard for jumbo credit is three active tradelines with activity in the last twelve months, per borrower.

So in that spirit, I’m going to let you all in on a secret for getting a great jumbo loan if you are thinking that a mortgage application may be in your future in the coming months. Here are three GREAT ideas for taking that seldom-used credit card lurking in the back of your wallet or purse, or that forlorn department store card that you forget you had, and turning it into a bona fide active tradeline which, in turn, makes you eligible for the widest selection of jumbo loan programs.

1) The Starbucks Triple Mocha Frappuccino (Venti): $4.95

This frosty beverage will set you back both 500 calories and 500 centavos — but don’t you dare pinch pennies to pay this time. Instead I want you to reach for the least-used credit card in your quiver and rack this hefty charge on that piece of plastic. By doing so, you’ll bring this credit card to “active status” within the last 12 months and you’ll be on your way to both cardiac arrest and credit qualification.

2) Nashua Tape 1.89 in. x 120 yd. 300 Heavy-Duty Duct Tape (2-Pack): $10.88

Race fans! Hot rodders! Weekend warriors! Remember when you bought your house and your mother-in-law gave you a $100 gift card to Home Depot? Remember when you used it all plus another $400 on that initial visit and they convinced you to open a store card, take advantage of the discount and then pay the rest off later? Remember too that you haven’t used the card since that day twelve years ago? Well, now’s the time to repair everything in the house with duct tape. We already knew of its all-purpose abilities, so you’re burnin’ daylight, pardner. Get crackin’ on those DIY projects and the ‘honey do’ list and pick up a two-pack just in case.

3) The Warren Plaid Boxer: Now $15.00

One other thing that we know is that if someone is going to have a collection account on his credit report, and it’s going to be of the variety of which he’s unaware, it’s either going to be a medical bill or a Banana Republic store card (close third to a cell phone bill never received). I’m not sure why this is, but people go bananas over Banana’s billing. So let me help you save your credit shorts and get into a clean, fresh pair of undies while at the same time giving you an excuse to A) actually locate your Banana Republic card, B) place an order on it before they call you to tell you it’s been inactive since Marky Mark made skivvies the shizzle and, C) bring your store card to active status in the eyes of Equifax, Experian and Transunion.

My point(s) above are simple.  Active credit tradelines are a critical component to getting a great jumbo loan, but you can’t create them after you’ve applied for a mortgage. When we pull your credit report as part of the pre-approval process we’re looking at both credit history and recent activity but the time to address both is BEFORE you’re in the mortgage process. Or while you’re saving for your down payment. Or while you’re waiting for more inventory to hit the market, etc. Bringing your unused tradelines to active status is a little step you can take that will pay a big dividend later — opening up the widest array of jumbo options and, as a result, giving you access to the most competitive rates.  Let me know if you have questions about this aspect of getting a jumbo loan and I’ll be happy to help you craft a road map to success and hey, I might even let you in on a few more bargains as well…

Venti triple mocha frap for Ron,

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 To Win a Real Estate Bidding War

What’s the one thing you can do to make your offer to buy a home stand out?  What’s the secret sauce, the magic bullet, the key to success?  

If you answered, “There isn’t one,” you’re pretty close.  Truth is, I haven’t found any singular aspect of any offer that assures success.  All-cash offers, zero-contingency offers, overbid offers, offers with colorful “love letters,” etc., none of them provide any guarantees to the hopeful buyer.  But there is one thing I’ve noticed that does increase the odds dramatically — stacking advantages.  

More often than not, we observe that the winning bid is a combination of the right price, the right terms and the right people.  The weight given to each will vary, but these three elements seem to be common ingredients in the proverbial taking of the cake.  Ideally, you can exert a great degree of control over these aspects:  You can offer the price you want.  You can set the terms as they fit your situation and you can choose your Realtor and lender.  You have every reason to be optimistic.

The Price Is Right

I once had a seasoned Realtor tell me, “it’s often about price, but rarely exclusively about price.”  This is good advice and it’s also why financed buyers are sometimes surprised to learn they beat a competing cash offer.  Perhaps the “sure thing” its assurances of a fast close were not compelling enough to entice to the seller to forego the higher price you may have offered, sometimes because you were using financing.  So determining when to bid under, over or right at list price matters and it’s a foundation for the rest of the offer you’ll build.

The Terms-inator

Having the right terms on your offer helps appeal to the seller’s confidence level (or lack of it) in you, the buyer.  Your terms also speak to the seller’s preferred timing and need to control a sequence of events.  One might assume that a fast close is always the ticket here, but…not so fast.  Some sellers actually need more time to close and recognizing their key thresholds will help you craft the terms you’ll state for releasing your inspection, appraisal and financing contingencies, as well as the timing of the close.

Not Everyday People

If you’re ever so bored that you need to kill an afternoon, look up how many real estate licenses have been issued in your area.  Next, look up how many of those active licensees transact one or less purchase or sale per year.  My point here is that you have a choice of your real estate representation and choosing wisely makes a big difference in your success ratio, even before you set foot in an agent’s car.  Locating a Realtor who knows the market intimately, has current negotiation experience and who garners respect in the community provides an edge perhaps greater than all the others.  Of course, choosing your lender wisely matters too, and in many areas where competition is fierce, we have learned firsthand that the listing agent will accept or not accept a buyer’s offer based on who is providing the financing.  If the listing agent knows a lender can be reached as needed and has been accountable to them and their colleagues in the past, your offer takes on new meaning.

Hundreds and hundreds of transactions have given me a window into what it takes for buyers to succeed when they place an offer on a home they wish to buy.  The results of that perspective confirm that it’s rarely any single aspect of their offer that has the ability to seal a deal, but instead the right combination of factors.  By “stacking advantages,” including offering a compelling price, setting the most appealing terms and using strong professionals on their team, a buyer’s odds increase exponentially.  And the best part about all of this?  Buyers control each block in that stack — so use great care!

Timber!

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 Do Rate Locks Work?

There is one thing in common among all of our clients.  No matter what price point, no matter what loan size, no matter good credit or bad, no matter first-time buyer or seasoned investor, all are looking for the lowest interest rate at the lowest cost.  But how does a mortgage borrower secure such terms?  A part of the home loan process is “locking an interest rate” and this process could use a bit of explanation, so as to dispel some of the myths and offer a better understanding of how things work.

What Is a Rate Lock?

You’ve done your interest rate shopping and made a decision about working with a mortgage lender/broker.  The time has come to “lock” a rate.  What does this really imply?  A rate lock is a commitment the lender makes to you to preserve a given rate for a specific period of time.  In exchange for this commitment, you, the borrower, are insulated from market risk.  Once your rate is locked, that is (barring a few exceptions) the rate you will obtain for the life of the loan.  With many lenders today, there is no cost to lock a rate, but as you’ll see below, there are implications once a lock is in place.  It is fair to say a rate lock is a commitment on both sides of the transaction, borrower and lender.

Time Is of the Essence

All rate locks exist in finite periods of time and the most common lock periods are 30 days, 45 days and 60 days.  Longer locks will commonly have higher rates or costs associated with them, and this is a function of risk.  The longer a lender commits to preserve a rate, the more the lender is exposed to underlying financial market volatility.  Think of your rate lock in the same light as a life insurance policy.  Purchasing a policy with a longer term will be more expensive because the likelihood of a claim increases for the insurer as the years go by.  

Breaking the Chains

So now that you’ve locked your rate, what happens if your lock expires, or you decide to break the lock, or rates go down?  These are all valid questions and they can all be addressed by the blanket statement that just as in life in general, breaking a commitment in finance has consequences as well.  Some lenders offer enticing “float down” policies and suggest that clients can have it both ways — both locked and floating.  There is always an offset with such approaches because behind the scenes in the mortgage secondary market, rates locks are complex hedges that involve costs and have metrics that impact a bank’s efficiency and cost of providing funds.  All lenders want to have strong “pull through” on locks, and their ability to offer future clients competitive rates depends on this.  All this said, sometimes rates do drop dramatically while a borrower is in process and there is potential for a “renegotiation,” but this is not common and any rate lock should always be perceived, first and foremost, as a “for better or worse” proposition.  Finally, transactions that run longer than their lock periods are faced with extension costs, which are best avoided.  Borrowers should know that they cannot deliberately exhaust a rate lock in the hopes of capturing a new, lower rate with the same lender.  In those cases there is often a 30-day “freeze” where a new lock would be subject to “worst case” pricing.

Locking your interest rate on a mortgage is an important decision and an important commitment.  A good lender can help you navigate the nuances of the choices before you.  Fundamentally, one locks a rate to prevent the risk that rates will go higher while in the process of purchasing or refinancing a home.  What we see, in practice, is that deliberate action tends to relieve stress and assure a better outcome.  “Floating” a rate for better is always tempting because as we agree, everyone is enticed by the idea of lower rates and lower costs.  But remember, temptation can lead to unecessary risk and risk is what a rate lock strives to address by tamping down market volatility and containing aspects of your process that you don’t control.  Understanding how a rate lock works and formulating your own plan on locking is a smart move, and we’re here to help you with it.  

Lock ’em and doc ’em,

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

Anyone Can Hold the Helm When the Sea is Calm

If your business is anything like mine, COVID is presently dishing out challenge after challenge to the way you (used to) work.  If it hasn’t already driven many nails into the coffin of the way things were, then I’m willing to bet you’re within earshot of the hammer.  If you’ve had time to collect your thoughts and countenance reality, you may have even begun to think about how biz will look in 2021, 2022 or beyond.

Many of us, in real estate careers we have built over years or decades, have assumed a form of de facto leadership.  We likely have staff that report to us and certainly we have clients to manage and lead through the complexities that even an ordinary real estate transaction can impose.  People referred or returning to us have come to rely on us commensurate with our experience, good judgment and history of positive results.  Yet even for the most seasoned pros, there comes that day when we are just sailing along, minding our own store, and a real problem arises.  Because of our intuition, most of us would admit we can usually sense trouble before it truly gains momentum and, in turn, this is the moment at which we begin, on levels subtle and overt, to mobilize…

…or not.  As I have observed leadership during this same pandemic above, I am keeping a close eye on how it is being managed.  Or not.  Where it has faltered and failed, I have discerned these lessons below, to use and reinforce in my own life and practice:

Don’t Ignore the Problem

Perhaps one of the first and worst responses to a rising sea is to pretend that it’s not rising.  Those who have a nose for the wind can tell when a storm is brewing — long before the gales are whipping through the sails.  Denial, wishful thinking and hope are bad strategies.  Historically over my career, I have felt less anguish for the times that I have been needlessly overcautious versus the times that I have been deliberately, negligently or lazily unprepared.

Don’t Make the Problem Worse

Once a troublesome situation has developed, the next worst thing you can do is set in motion a pattern of dishonesty.  Small lies lead to bigger lies but eventually and inevitably they all crash into the truth.  Part of our job as professionals is to use discretion and specific judgment.  This often manifests itself as the careful framing of a situation.  After all, we’re not going to rush out and tell every party to the transaction that we have a problem when it’s first discovered.  If intent on actually finding a solution, we are going to circle our wagons and get very busy behind the scenes.  This may mean that for a period of time we have to be very selective in what we disclose, and to whom.  The pilot of an airplane doesn’t need to scare the beejeezus out of passengers at the first onset of turbulence.  He can give a concise report when the time is right, though the clock is always ticking.  Just enough turbulence plus just enough silence will equal way too much panic.  

Don’t Delegate the Problem

If you have the stuff to be a real leader, then you take, and likely have taken, ownership of the tough ones.  You don’t throw people under the bus, you don’t seek to blame as a go-to strategy and you don’t delegate the difficult decisions.  Instead, you consult experts, you seek diverse advice, you confide and decide.  Just like water seeks its own level, if you want to know who the real leader is in any operation, observe to whom people run when there’s a fire.  If that person is you, and you delegate that emergency to another, and that other person deals with the issue, don’t expect to be viewed as the leader ever again.

Don’t Hinder the Problem Solvers

Thomas Paine is often credited with the saying, “Lead, follow or get out of the way.”  My guess is that the sentiment goes back well before his time.  When in the thick of trouble, if you’re not going to commit to being productive and leading the way out yourself, then either follow the advice of others or get out of the way of both the leaders and followers.  Fast.  Once you have extricated yourself from playing a constructive role in the outcome, your counterproductive comments, criticisms and observations are no longer welcome.  Instead, focus your energy on getting yourself back into the good graces of the leaders or followers and do your part to help when and where you can.  Ultimately, problems get solved best when they have the highest percentage of buy in from those they impact.

Thanks to the pandemic, many of us find ourselves mourning the loss of the way things “used to be.”  We want to attend gatherings, we want to eat in restaurants with friends, we want to watch our kids play team sports and go back to school with their classmates.  But soon enough, we have to move along in these stages of grief, become part of the solution and take progressive steps in helping develop and promote a new normal. When tasked with leadership, those we are leading are watching us closely and counting on us.  Anyone can hold the helm when the sea is calm.  But the sea isn’t calm right now and it’s rising again.  No doubt, real leaders will also rise to meet this challenge.  I plan to do my part to be one of them.  And you?

Oh Captain, My Captain,

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

Your Pandemic Guide to a Jumbo Mortgage

“Our Realtor said it’s very difficult to get a jumbo loan these days.”

“We tried to do a cash out jumbo refi on our place but our bank told us that they’re not doing those anymore.”

“We wanted to refinance our jumbo loan but by the time we did the research the rates weren’t any lower than what we have already.”

“Is it possible to refinance a jumbo loan without having to move our savings and investments to the bank who’s making the mortgage?”

“We have a 20% down payment and are looking to buy a house that requires a jumbo loan.  We had no idea that would be so difficult.  Why are banks now telling us we need more than 20% down?”

As we go into the second half of 2020, it’s unquestionably true that we’ve seen a complete reshaping of the mortgage industry due to financial turmoil wreaked by the COVID-19 pandemic.  And one of the products under most pressure has been the jumbo loan — programs that accommodate loan amounts greater than the conforming or FHA limits.  Access to this tier of credit is essential to the higher-cost coastal real estate markets as well as to larger cities with luxury markets, like Chicago.  So is the home buyer or owner looking to refinance out of luck if he or she needs a competitively-priced jumbo loan?  Fortunately, the answer is a resounding “NO!,” though some research may be required to find it.

As of June 1, 2020, here are some of the jumbo mortgage options we will permit:

  • 20% down payment purchase jumbo mortgages to $3MM.  Max purchase price is $3,750,000 in this case.
  • Cash out refinances to 70% loan-to-value (LTV).  Cash out amounts can exceed $250K.
  • Jumbo purchase and refinance mortgages that do NOT require transfer of assets to us.
  • 10% down payments on jumbo mortgage options.
  • “Rate and term” refinances to 80% LTV, up to a $3MM loan amount.

While we are not out of the pandemic woods yet, we expect that our jumbo options will continue to strengthen and expand so long as real estate sales remain robust.  While much of the country can make do with conforming loan products there are many key markets that rely on efficient and cost-effective jumbo loans.  We’re here to address that need if it applies to your scenario.

Go big and/or go home,

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