Electric Loan Officer

Category - Credit Help

Where other lenders fail, we prevail | We close your turndowns


I’ve got a great story about a Real Estate Broker whose bread and butter Loan Officer let’s him down at the 11th hour, and by 11th hour I mean on the 6th week of a 30 day escrow. No, I’m not kidding… Unfortunately things happen, I have learned from many of my own mistakes but you have to hear this story.

A couple weeks back I get a phone call while I am sitting in the Westin Bellevue in downtown Bellevue Washington. The phone call was from a Real Estate broker who was referred to me by a Real Estate agent that knew me from a few years back. Apparently a few years back I took a lender turndown and closed it for her client, and she remembered.

This Real Estate Broker was in a predicament, his loan officer from “X Mortgage” (sorry I can’t put the name here otherwise some may consider it “slander”) declined his own personal mortgage loan at the 11th hour. He had heard that I was able to work some magic for the agent that referred him to me years ago and he wanted to see if I could help. My reply was “you know, I can do some things others cannot but I can’t make you any promises”. I politely asked him to send me everything he had sent to his other loan officer and that I would be back on Monday and would review it and give him a decision.

Once back in town I took a look at the package, cross referenced it with agency guidelines to ensure that we wouldn’t have any problems and everything checked out great. I picked up the phone and let the borrower/agent know that I could do his deal, he was astonished but didn’t really believe anything until we had docs out. My team transferred the case number and we had his docs to title in about 10 days and that’s all she wrote. Another deal saved, I look like a hero, I love my job.

So why the heck is it that I can do deals others cannot? I mean seriously, it’s a very valid question. In this case it had to do with being Fannie, Freddie and Ginnie direct. We do not fund these loans and sell them to an investor like Wells, or GMAC or Flagstar who slap on a bunch of overlays! We fund these loans, sell them direct to agency (FNMA, FHLMC, GNMA) and retain the servicing rights on about 90%. This means that 90% of the loans we fund the borrowers will make their payments to us, because we have the financial capacity (currently servicing $2.7b) to do this we do NOT have to fit into someone elses box. Plain and simple, we make our own box. I was not used to this at Nova, I was used to every lender we sold to having their overlays and trying to figure out where to place a loan. Now, I dont have to deal with that, I can spend my time finding people who need my help and this has proven to be truly rewarding.

So after we get this deal closed, the agent who referred this borrower/agent to me calls and says, “hey listen, you always seem to prevail where our other lenders fail and quite frankly we don’t want to have to put our clients through the ringer, we want to start sending them to you first”. I politely and professionally accepted the compliment and the business, within the next week we had two more clients under contract. This to me is success.

-Mr. Electric Himself

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Reverse Mortgages | Setting the Record Straight


Last evening ABC News ran a consumer report segment outlining the dangers of reverse mortgages.  I want to take a moment to clarify points madeIn the broadcast and to set the record straight.  As is often the case when the media addresses the mortgage industry and housing markets, the reporting took on a decidedly negative tone.

 ABC interviewed a widow who recently lost her husband and who had received a notification that the reverse mortgage he had previously taken was now due and payable.  She was unable to refinance the home and was forced to sell.  This situation is not unique to the reverse mortgage program!  Once the borrower on a traditional mortgage passes, that loan would also come due.  If the heirs were unable to sell or refinance, a foreclosure would ensue.   Removing an owner from title is never something to take lightly but the results came about because there was a mortgage in place, not because it was a reverse mortgage.

 ABC also pointed out that the default rate on reverse mortgages is 9%, higher than the average for government-insured loans.  It is important to remember that reverse mortgages don’t require a monthly payment by the senior.  One might ask “How then can they ever be in default?”  This technical default situation stems from one of the features of a reverse mortgage – that the senior retains ownership of the home.  Because the senior owns the home, they are responsible for payment of the hazard insurance and property taxes.  A certain number of seniors have failed to maintain these payments causing tax delinquencies and violating the terms of the mortgage.  This would also be true if they had a traditional forward mortgage on the property.  HUD requires that reverse mortgage servicers work with the senior to correct the problem or, as a last resort, foreclose to keep the lien from being lost to a tax sale. 

This process if true for forward and reverse mortgages.  A senior isn’t going to lose their home because of a reverse mortgage, in fact, quite the contrary is true.  We can help seniors who are in danger of losing the home to a foreclosure or tax sale by putting a reverse mortgage in place.

 The reverse mortgages offered through Nova Home Loans are the federally insured HECM products.  These loans have many safeguards built in to protect the senior and Nova.  Key among these is the requirement that the senior and any non-borrowing occupant of the home attend counseling through a government-certified agency before we even begin the application process. 

 I believe that education is the key to determining whether a reverse mortgage is a good fit for any customer’s needs.  Like other financial products, they aren’t right for every situation.  Nova is a member in good standing of the National Reverse Mortgage Lenders Association and we subscribe to their strong ethical guidelines.  Our dedicated reverse mortgage team is ready to educate your customers, REALTORS, and other referral partners about the benefits and drawbacks of a reverse mortgage.

 The question about whether a reverse mortgage is safe can be answered by “would you put your parents in one?”  I can tell you that I did and they thank me to this day.

Best Regards,

 -Glen Smart | Reverse Mortgage Division Manager | www.smartloanaz.com



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