#WhackedOutWednesday – Important parts of loans are everywhere! However, there are certain things that can make or break loans. And this is why I do whacked out Wednesday shows to help LO’s know what to avoid or to do mortgages right. So check it out, the 1003 and the CD are the heart and soul of a mortgage loan. The two biggest mistakes on the 1003 I go over, and the balance of a file prior to the final CD is talked about. ↓
With so many moving parts in loans I’m certain that you have made mistakes in your career just as I have. The two best practices I share today are; 1, garbage in, garbage out. If you input numbers without breaking them down, you will have issues with cash to close, to balancing of the file, to getting “fake” DU findings. Meaning they are not right. Number 2, is the CD. This should happen with #Wholesale, but it doesn’t. Most retail banks often require a LO to review a CD and sign off on it prior to even sending to a client. It’s a best practice, and should be done with Brokers. Seriously. If you don’t balance your file prior to closing, you will get to escrow and find out sellers concessions are left on the table, or something is different in your structure than you promised the client or expected. Balancing a file should happen upfront, but often times is isn’t. And then left for the processors to view, and they don’t know what YOU sold the client. It is WHACKED OUT that the details of the transaction are not married with LO approval until the end. Don’t be that guy/gal!
As I always do, I offer my clients help with structuring the loans fees, structure, guidelines etc. My role is to be your caddie on the side as your the golfer in the transaction moving the ball along to the hole. (closing) Let’s do business and make it happen together! CLICK HERE to sign up!
#ThursdaysThoughts – Back to basics for LO’s and a great reminder of how to actually “get loans done”! Seems to me every month that I see LO’s struggle with getting loans done or have issues with conditions it’s correlated to these three things I mention today. If you go #BacktoBasics and focus on these three things, what comes out on the other end will be docs. (on more loans) 🙂
Accurate and complete 1003 is the start. As you fill it in and gain supporting documents remember to go back and plug in the “real” numbers into the 1003. Like start dates of employment from a VOE into the 1003 for example. Details of transaction is the heart of the actual money exchange and is often the last piece of info that’s 100% complete. Why? – Well after you lock a loan you need to go back and plug in the credit or cost associated and it will change your file’s structure. It’s amazing that sometimes people don’t have sellers contributions or other credits plugged in from the start, but as you get towards the end of your loan #BestPractice LO’s should be balancing the loans structure. And throughout the loan the biggest mistakes on loans can be avoided by not submitting unnecessary information to the underwriters. And what I mean by that is to actually READ your DU/LP (AUS) findings!
If more LO’s go back to basics they will be more successful. It’s the truth, and real Thursdays thoughts you can take to the bank. Complete a 1003 accurately and 100%, run DU and submit only what DU asks for upfront and throughout the loan, and verify your structure on the loan in the beginning, at lock, and prior to CD going out! If you do this, you’ll have less issues, less stress, less fall out, and less last minute changes. Mark my word!
As always I want to offer coaching and help to anyone that wants it. Doing loans doesn’t have to be rocket science, or complicated if you stick with basics to make healthy loans. Hard loans, easy loans and all the loans in between I help LO’s complete with an awesome ops staff. Why not make an impact together in 2019 – CLICK HERE!
#MondaysMotivation – Check your 1003 for accuracy and these three things! Today I itemize the 1003 killers, that every LO should master. You know the old saying, garbage in, garbage out! Well if you take an accurate 1003 and address these three areas to be 100% half the issues most LO’s have will go away.
Before you turn in your 1003 from the weekend, double check these things. ↓
I’m here helping 1003’s come to life and become funded loans! Got something that has fallen out of agency approval, or even non-agency? In need of a manual underwrite? While I ♥ a great approved/eligible loan, we do manuals to save the day often. CLICK HERE to get approved to start structuring loans with us!
#ThursdaysThoughts – The best of “Whacked Out Wednesday” all week long, hope you’ve enjoyed and are picking up things to avoid or to do to close more loans. Today is no exception and goes with the Thoughts that each loan officer creates their own head aches by not completing the bill of sale! Every sales person out there has to fill in some paper work that becomes the frame work to the sale. Car guys, vacuum sales, insurance sales you name it. Mortgages bill of sale is really the 1003!
The 1003 is the heart of the mortgage transaction and underwriters are really just looking to verify the information on the 1003. Make sure you are completing the 1003 and it’s accurate. And you check the information that the client sends you and compare it to your 1003. These are small things that you can do to help your own “Bill of sale” be done correctly in mortgages.
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Thursdays Thoughts – Don’t be whacked out and half ask the bill of sale!
#WhackedOutWednesday – Remember the Details!! Details – Details – Details – Especially on the 1003 which is the heart of the transaction. Make sure you are looking at the small things, like the bank account numbers, names, middle initial, credit report etc. These small things help the full loan close smoother.
The funny thing is there is a BIG correlation with those that pay attention to the details on the 1003 and have smooth transactions time after time. After all, that’s what an underwriters job is to do; verify the information that’s on the 1003. The more accurate and attentive to detail you are upfront the more loans you will close. It’s that simple. And if your doing it right, in the process of taking that application you can use the small details to help you build rapport and make the “experience” for the client one that is enjoyable.
Simple – Yet a good reminder – Slow down when filling out the 1003 and do it right the first time!!
Details are in most things associated with loans, that’s what makes or breaks them. Weather the loan fits a guideline or the information being provided is going to clear a condition. The whole reason a loan goes ROUND and ROUND at any one time is a result of some detail that wasn’t picked up on upfront. I help LO’s close more loans in many ways and spend the majority of my day talking about loans and leads. I can help you with either —- CLICK HERE!!
#TwoforTuesday – Today I go over two lending tips for you LO’s to help you structure and get more deals done. The most common misconception on the 1003 and incomes are addressed. Seems lot of LO’s aren’t sure on how this works, or question income. Here’s a cheat for you to apply.
The 1003 needs to have two years of work history and two years of housing history. While in some cases (W2) the current 12 month income is looked at and the past 12 month housing payment history is analyzed, you still need to document TWO years on the 1003. As far as income is concerned, the most common is those that are self employed and LO’s are attempting to “average” that income. When in fact, it shows a decline in income over the past 2 years more than 25%! That’s the magic number to remember, if the declining income is more than 25% decline, you don’t average, you just take the lower of the two years (most recent). Some additional tips in today’s video where I go over this below! ↓
It’s one thing to develop the leads and referral partners to get on the phone with clients. Once you start pulling credit and putting together deals, don’t forget the basics. The 1003 is the heart of the transaction and all underwriters verify that information. The more accurate the 1003, the more easily loans close. – Remember that!
#TGIF – The Grind Includes Friday (everyday for me) 🙂 – Very frequently I am asked about rules of the 1003, and wanted to drop two commonly asked questions as guides today. Number 1, the 1003 is going to changed, yep you’re going to have to learn a new one! But not until 2019. So you still have 1 more year with the current version of the URLA. So good news there. Number 2, the most commonly asked question I get asked is about the work history. Most get confused about the rules for using income, and how to fill out the 1003. Let me clarify. – You need to detail a 2 year housing and a 2 year work history on the 1003. It’s as simple as that. If they have only worked at their current job for 30 days, just keep asking the client “where did you work prior to that?”. Make sure you detail 2 years as a history of working. Now high school does NOT count, but trade schools and college do. If there is more than 30 day job gap all you need to do is get a letter of explanation from the client (loe/lox). Simple. Number 3, the rule of 5. I love this rule. And many do not know it. So here’s a cheat sheet to refer too. Commission, bonus, over-time, self-employed or working two jobs are the 5 things in this rule. And really you only need a TWO YEAR HISTORY OF WORKING TWO JOBS AT THE SAME TIME! The rest of the rule of 5 you only need a 1 year history of doing. With exception of being self employed and actually working in the same field for 2 years or more, but you can be self employed for 1 year only and do a home loan.
Better yet, you can use our #SponsoroftheWeek PERFECT LO to help you take an accurate 1003 from the start! #SellWell
I’m growing again and today calling Broker’s I do NOT know at all. If you watch this, share it with a fellow Broker or Bank that could use a great Account Executive to help them close more loans and gain more business! #FilloutBelow
#TwoforTuesday – Sales TIP day, I go into the two things that have made me successful in whatever I do. Consistency and Action. Both work hand in hand, and all start with taking action. Make time to prospect, make time to follow up, make time to go over emails and voicemail. When you create consistent habits of action is when you will see results in the long term. #SellWell
Ok, normally I do #TwoforTuesday, did you read it the same way? Second, this is the biggest aspect of lending that is missed. It’s how we train our brains to skim over stuff. Our eyes go over it and can read things without us really reading them.
This applies to ALL information placed on the 1003. Yep, that’s how loans work. You put info on the 1003 it needs to be “verified” in proof. So do you as an LO actively R34D the informati0n s3n7?
Common mistakes, #TwoforTuesday #1 is read the information sent to check to verify it would have the needed checks on it. Not only is the CPL verbiage spelled right. But for example if on the 1003 you place 30k in assets, verify that the bank statement/asset statement has at least 30,000 as a balance. As you gather information as “proof” the best thing a LO can do is change their own point file. YES as you go on a loan, do you actually input the real values you get from the client into Calyx or Encompass? (not many do this). The LOS you use should be updated and when certain changes happen you should RE-RUN DU on your loan. Make sure it stays eligible throughout the course of a loan. Especially if you are doing a formal Change of Circumstance request (CofC) and including when you “lock” the loan assuming that rate is different than what was proposed at time of application. Re-Running DU on the “broker side” is a good idea. Don’t just ask for the change and not update your information or verify that the change requested will be ok. And once you do gain eligibility, then READ your own findings and gather what that is calling for. Especially upfront. Don’t overkill and send in too much information, just read DU and give the initial underwriter as much of those findings as you can upfront. So as I pointed out, there are multiple items to READ over in regards to what to gain from the client and AFTER that info is received from the client. #CHECKIT
Common mistakes, #TwoforTuesday #2 is to fill in the 1003. Completely. From start to finish. Look I work with processors quite a bit in my day’s routine. Or Broker’s that process their own loans. The number 1 thing I see is that an underwriter or myself will ask a question and that 1003 shows one thing or a declaration question not checked correctly or something. Even vesting request or source of down payment doesn’t match the information provided. Or the story that’s being presented. Small “conditions” can be avoided if the 1003 is thoroughly gone through on each and every loan. That is technically the job, the role, the fact you have a license to discuss terms on. However this “part” is whipped through over and over by Loan Officers all the time. When I did a 1003 #backintheday there were several of us in the office that would play games to see how much information we could get. We would ask what color is the blinds, to having a prospective buyer describe their dream kitchen. Just various things to really go deep and bring out EMOTION during the 1003 taking phase. When I did that task of 1003 taking, I would always aim at taking a 1003 through a guided conversation that engages the client and helps them open up to me. On all levels of finance to personal life, goals, dreams and aspirations.
If you need something you can use as an application “flow” sheet, feel free to head over to Sales Talk with Mortgage Pro’s . In the files tab I have kept a copy of what I used to use all the time, one is for “power buyers” and one is for “refi’s”. Just a copy of a “application flow sheet” that could help you along the way. A winner is a dreamer that never gives up!