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October 16th, 2009 12:51 AM

Dear Friends,

Around this time every Autumn, I'm reborn!  The trappings of a busy, goal oriented life continues, even though several obstacles prevented my efforts in writing the TeamBlog which was scheduled to be posted several days ago. If it weren't for my excitement in celebrating a birthday or taking a day off from work on Monday for Columbus Day or my curiosity in watching a snippet of Sidney Poiter's reprised portrayal of a police detective in the 1970 film, 'They Call Me Mr. Tibbs!' or the shocking death of Macarena in the telenovela 'En Nombre Del Amor' or the heavy rains in Los Angeles which destroyed the power line to my house creating a power outage for over 24 hours, I must say I'm in good spirits and not worse for wear! I also was delighted to receive my first phone call of the day on Tuesday from 'Bobby', a splendid octogenarian client and a wonderful friend for many years, as he recited verbatim 3 Rodney Dangerfield jokes, too scandalous to mention here. But I must say that I too at times fall victim to the antics of others and get no respect! Well, that's life! During my Freshman year at college my English 101 Professor always mentioned that 'life is not a bowl of cherries'. At the ripe old age of 54, I've known this from the day I walked in her classroom 36 years ago!

Loan Stories From Our Vault

In recalling the previous post of our TeamBlog, I mentioned there were times throughout the years where a handful of   loan originations have gone into a cesspool where Murphy's Law was duly incorporated. There are the run of the mill stories where clients quit their jobs in the middle of the loan process and are astounded when the bank denies the application after securing an approval just weeks before. There's another story where elderly clients within the hour of signing refinance loan documents, left the escrow office, got in their car, turned on the radio and heard a competitor offering an all expense paid trip to Hawaii for 'free'. The borrowers immediately called to cancel the loan just agreed upon, reapplied and was approved by the bank offering the trip, only to discover, the 'free' trip was not 'free', as the expenses for the trip were hidden in the closing costs and the interest rate went up during the processing of their new loan!

Another story which has happened more times than I care to remember revolves around a refinance or purchase transaction which MoneyTeam secured for a client in the past. This same client decides to submit an application to another lender or mortgage broker only to recognize the rate and the fees charged were much more than MoneyTeam would have requested in the first place. The embarrassed client requests that I review the closing statement, only to be made aware of the misfortune of paying higher closing costs and the awkward explanation which follows of not submitting an application  with our company at the outset. I've also experienced situations where previous clients, after several attempts in submitting their application to various lenders all over town, eventually ended up empty handed with loan denials as a result. But miraculously, once the loan was submitted to MoneyTeam, an approval provided a happy ending!

Going The Distance

I never give up! There will be no stone unturned until I see a client go home satisfied with a loan, which helps solve a current need or a recurring problem. There was a time years ago that I submitted a client's loan application 17 times before receiving an approval from a bank! Even with today's mortgage meltdown, there are rare occasions that after much pleading and organizing the case for a loan approval on a difficult file, the underwriter can 'see the light' and does her duty to secure an exception.  

I've also had circumstances in which the borrower was not forthright and neglected to mention a bankruptcy, marital status  or child support obligations when interviewed, ultimately preventing MoneyTeam in procuring a loan approval on their beahalf. I've also examined fraudulent tax returns, fake social security numbers, pay check stubs, bank statements, bogus appraisals, reviewed questionable paperwork from 'straw buyers' and other types of financial documentation which results in a colossal waste of time. As a reminder, there are in place new federal guidelines to end such abuses and the penalties for such misguided attempts of deception are staggering.

Today's Reality

While there are 'Draconian' safeguards in all new loan originations due to the sub prime mess we've witnessed these past several years, we are now entering a new phase. This phase is where common sense and competence is no longer utilized in underwriting by at least one major bank that I've submitted loans to recently. There is a dwindling supply of banks, mortgage bankers and institutions that have the ability to finance mortgages. If you check the Mortgage Implode-O-Meter website, http://ml-implode.com  you will notice the decimation of this industry continues to this day. Knowing full well the state of mortgage financing, when an old acquaintance suggested I try his bank, I jumped at the chance! He mentioned the prospect of quick loan decisions, competitive rates, good loan programs and low fees. I immediately submitted 4 loans. All of the loans were approved within 48 hours. I relayed the good news to my clients and to continue processing the file I was asked to provide their credit card numbers so the bank could order the appraisal. The appraisals were ordered, there were no delays in its completion. The values were conservative but did not affect the equity required. However, after numerous inquiries in regards to the disposition of loan documents after chronic delays, the loans which were approved just a few weeks before were denied for no apparent logical reason. I was furious! When clients have an average of 800 Fico credit scores, over $150,000 in cash reserves and low loan to value ratios of 35% or less, there must be a total disregard of common sense or a penchant for incompetence to deny a loan application with such favorable compensating factors. On all 4 loans the bank's decision was final. To add insult to injury, the bank refused to reemburse our clients for the appraisal fees. The horror of this situation was alleviated when MoneyTeam resubmitted these files to other lenders where 3 of the 4 loans were approved immediately.

In denying loans, many banks rely on cold, disparate and obtrusive equations which eliminates the human component in decision making. When a bank of this magnitude, lacks the basic understanding of mortgage guidelines or the discernment in evaluating a file without seasoned mortgage professionals on their staff, the proclivity of inept underwriting decisions becomes a sad reality. This major bank was awarded our taxpayer dollars in the bail out frenzy Americans have come to despise. We know full well the monies were used to replenish their cash reserves, to purchase other ailing banks and were never utilized as intended, in funding mortgage loans to worthwhile aplicants. So far this year I've encountered lazy responses from lenders eager to decline a file rather than work the numbers by offering the approval the loan file merits. This kind of mindset is prevalent. It stands to reason the day the pendulum begins to move so ever slightly away from such a strict adherence to such factors, this will be the day the US economy and the marketplace flourishes unencumbered.

20th Anniversary Sale Continues

Our sale continues! Please review our website for our current offers until the end of this month. Now is indeed the time to refinance as mortgage rates continue to be attractive. If you are a first time homebuyer, the deadline to take advantage of the $8000 Tax Credit is fast approaching. Your loan must close escrow by November 30th. MoneyTeam is working at all hours to help you beat the deadline! Call our office at 323-936-3232 for more details on how we can help you! 

Open House On Sunday, October 18th

I will be helping Melissa Zee of the Beverly Hills office of Rodeo Realty, qualify prospective buyers at an Open House from the hours of 2:00 PM until 5:00 PM. Please check the website: www.8404franklinave.com for more information in regards to this beautiful home. I hope to see you there!

Help Needed

My good friend Arnold called me the other day to voice his concern in regards to the tragedy in the Philippines. We spoke about the devastation from Typhoon Ketsana which has resulted in over 1000 deaths. This tragedy has galvanized many Filipinos and concerned citizens in the Los Angeles area by sending clothing and donations to help those in need of shelter in the region. We invite you to send a contribution of any size to help those devastated by this ordeal. You can visit the website where your gift will be truly appreciated: www.philippineaid.org.

Thanks Again         

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Posted by Jesse Dorado on October 16th, 2009 12:51 AMPost a Comment

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