Professional Mortgage Moment – Guessing Again?!?

January 12, 2012

by Brian Short, CMC, CRMS, GMA

Tennessee Mortgage Professional, Brian Short, demonstrates why it is important for mortgage loan customers to use a mortgage professional who will not be simply guessing when it comes to very important final numbers on any mortgage transaction.


Choosing Your Mortgage Professional

June 20, 2009
By Brian Short, CMC, CRMS, GMA
“Shopping for a Mortgage Professional is much like shopping for a medical doctor or an attorney. Choosing your medical or legal care based on “who is the cheapest” may not really be the best strategy. You want you choose a professional who is trained, certified, experienced and has a good reputation.” 
Often times, this is my response to those asking for me to give them a detailed list of all their closing costs if they select me and my company to provide the financing for their upcoming home purchase or refinance of their current home.
I have heard of real estate industry partners telling their customers that choosing a mortgage professional is as simple as getting a “Good Faith Estimate” and comparing the costs contained on those documents.  This sets up the borrower to work with the “best liar”, too early in the 30-60 day process of finding a home, rather than getting the most professional financing help to get the deal closed correctly.
How can this be?  Aren’t all “Good Faith Estimates” accurate?  Aren’t all mortgage professionals the same?  Aren’t all mortgage companies the same? 
The truth is: the numbers on the “Good Faith Estimate” given too early in the process are RARELY CORRECT!  You see, the numbers on that document are affected by one or more of the following 13 variables below:

-> Sales pricegood-faith-estimate

-> Appraised value

-> Loan amount

-> Borrower’s employment status and history

-> Credit scores and payment history

-> Amount and source of down-payment

-> Date of closing

-> Immigration or citizenship status of the borrower

-> The housing type and location (Single family dwelling, Duplex, Condo, Townhouse, PUD, suburban, rural, urban, etc.)

-> The county where the home is located

-> Mortgage Interest Rate

-> The Term (length) of the Loan

-> The Title Company being used to close the loan

I have worked for several mortgage companies during my mortgage career and even owned my own company for 5 years. I know that some “loan guys” will “low-ball” the initial estimate, only to pull out the “surprise” at the closing table when your options for making any changes are very limited.  Of the 21 separate line-item fees on the “Good Faith Estimate” I give to my borrowers when they sign their loan application forms and disclosures, only one of those fees is the same for every loan and is not dependent on any of the variables listed above.

Mortgage interest rates change daily (sometime, even more often!). I could simply print off a “Good Faith Estimate” with made up numbers as some customers request (as other “loan guys” may do) but it will not be accurate because of all of these variables I have mentioned.  That process of collecting “Good Faith Estimates” prior to having all of the above variables identified will very time-consuming and wasted effort by the borrower and “loan guys” passing out worthless forms with inaccurate numbers.

My goal is to take the worry and uncertainty out of the process of originating, processing, underwriting and closing the loan.  I help guide my borrowers through their negotiations with their seller by providing honest numbers as they become available rather than simply making up numbers to get “my hook set”.

I have been in the business for over 11 years and nearly 100% of my business comes from referral and repeat business. A businessman can not build that kind of business by being a con-man, cheating others or participating in the bait-and-switch tactics that have riddled this industry for years.

This helps my my borrowers understand how I have built my business and how I provide a level of confidence and professionalism which will make my borrower’s Real Estate purchase a very smooth and cost effective transaction over the next.

So, you ask, how should I select the Mortgage Professional to close my loan for me?  I’m glad you asked.  Allow me to give you a few guidelines for starters:

1. Choose a Mortgage Professional who is EXPERIENCED.  Was he selling shoes or washing cars last week and then some buddy of his talked him into “trying out the mortgage business”?  Does he really know what he’s doing?  Has he been originating mortgage for 5-10 years?  Does he do this full-time or this just a hobby or part-time gig? 

NAMBCertified2. Choose a Mortgage Professional who is CERTIFIED.  Has proven to anyone that he knows the laws, the process, the programs and theory and mechanics behind the mortgage industry.  Has he taken courses and exams to measure his competency?  Is his certification a national designation? Is his certification from a professional association who can objectively measure and monitor his expertise or from some mail-order outfit looking to make few bucks?

3. Choose a Mortgage Professional with a GOOD REPUTATION.  Is your selection a true professional who is respected and well-known in his industry.  Who knows him and what kind of work he does?  Who has ever closed a loan with him?  Who can speak for his level of trustworthiness, honesty and attention to detail?  What do you know of his character and personality?

4. Choose a Mortgage Professional who is a PROFESSIONAL.  Does your choice know the market, the industry, the community, the history, the trends and your desires?  Is he a member of his professional association?  Has he been awarded and recognized by his peers and fellow business associates for his contribution to the industry and community?

During the month that your loan is supposed to close it is the most important transaction in your Mortgage Professional’s office.  “Getting it cheap” doesn’t mean much when your “loan guy” drops the ball and makes a mess of the whole deal simply because  he has “never seen anything like this before.”  That stack of bogus “Good Faith Estimates” collected 30-60 days prior to your closing will mean very little when you find out that returning phone calls, diligently following up on underwriting conditions, and working long hours to insure that all of the bases are covered on your deal are not his priority or part of his work ethic.

Paper is cheap, and ink toner to print fictitious loan estimates is even cheaper.  Experience, Certification, a Good Reputation and Professionalism are priceless life-long attributes and qualities you want in your Mortgage Professional.  Leave the spreading of such worthless papers to those lying, low-balling, bait-n-switching, short-termers who do not deserve to work with someone like you who, understandably, expect it to get done right the first time.

Raising the Bar for All Mortgage Professionals

November 18, 2008
By Brian Short, CMC, CRMS, GMA 
 Brian Short meeting with TDFI Commissioner Greg Gonzales

Brian Short meeting with TDFI Commissioner Greg Gonzales in Nashville. I have participated in meetings with Tennessee Department of Financial Institutions Commissioner Greg Gonzales off and on for nearly 6 years. My leadership positions within the the Tennessee Association of Mortgage Brokers ( have afforded me the responsibility and opportunity to receive an open door on many occasions in Nashville and Washington, DC with regulators and legislators who have influence over our industry. Each time I have been with the Tennessee Commissioner my consistent call has been for the need to increase the level of professionalism among those in our industry by requiring licensing, entry-level testing, background checks and continuing education. It has been my firm resolve that this kind of legislation and increased regulation would be good for all Tennesseans. I have been in favor of this kind of professionalism for all of my industry peers long before Rep Barney Frank and Sen Chris Dodd in Washington, DC ever got on this most recent - "shut down the predatory lenders" band wagon. Those of us in the mortgage industry have known that there were scoundrels among us. We knew that many who were originating mortgages really knew very little about the industry and even less about the harm that "short-sighted" loan programs could bring to a borrower's family, neighborhood or community. We knew that "interest-only", "no-doc" and "negative amortization" loans may have helped a desperate/greedy builder or Realtor sell a house, but in reality, those loans, very seldom were the best solution for any borrower who was stretching his or her monthly cash flow simply to buy more house than they could afford. In many cases, those who were leading the band wagon of "creative", "innovative" or "exotic" loan programs were simply pushing our industry toward risky loans which were not a sound or long-term lending solution for a unprepared borrower's housing dilemma. It has been my rallying cry for the past 6 years that the girl who cuts my hair for $12 every six-weeks undergoes more testing, licensing and continuing education than those in the mortgage profession in our state who are responsible for arranging the financing for the largest single lifetime purchase resulting in the greatest amount of debt for over nearly one-half of the remaining years yet to be lived by any first-time home buyer. Every other professional involved in the Real Estate transaction is licensed, tested and required to take continuing education - Appraiser, Home Inspector, Realtor, Insurance Agent, Home Improvement Contractor, and Title Attorney - every one, that is, except the mortgage professional. We are professionals whose work and expertise will have the longest-lasting effect on the home buyer - for better or worse! And yet, until 2009, no licensing, testing, background checks, fingerprints or education was ever required by the state of Tennessee!Last week I met, again, with Commissioner Gonzales and about 20 other mortgage professionals as we listened to him and others explain how laws that we had helped them pass earlier this year were going to result in new background checks, fingerprinting, entry-level education and testing being required for all mortgage professionals in the state of Tennessee beginning in 2009! These new laws will, undoubtedly, weed out some of those who have been "hiding" in our industry and have damaged the reputation of a very noble and difficult profession. I contend that the process of thinning out our ranks because of these "barriers to entry" into the mortgage profession will be good for those of who remain and especially good for Tennesseans who will know with confidence that the originator working with them will now have had to complete a background check, taken over 20 hours or initial classes and passed a test covering a set of basic information about the process of originating and closing a mortgage loan. All Tennesseans will be assured that their mortgage professionals will be keeping up on the changes in the state and federal laws and be reminded or what are ethical and unethical business practices because they will continue to take eight hours of additional classes EACH YEAR to keep their license current. This is great news for all Tennesseans!Brian Short meeting with a member of the US Senate Banking Committee, Tennessee Senator Bob Corker in Washington, DC earlier this year.

The new laws will also require that any mortgage professional working in any state across the country will be required to register in a National Mortgage Licensing System (NMLS) database to prevent a law breaking loan originator from simply moving across state lines to keep from being found-out and shut down as he or she cheats others, gets caught and then hopes to slip away to set-up these illegal practices in another part of the country without being found out.

Most of these new laws were being proposed and debated around the country long before our recent financial crisis and I’m not certain that any of these laws would have prevented the financial melt-down we have experienced over the past 2 years.  The “exotic” mortgage loans which have proved to be disastrously risky for many who have now experienced foreclosure were not the “brain child” of mortgage originators.  These programs came from the imiginations those sitting in the back offices of New York investment houses who were looking for creative ways to sell more mortgages to borrowers who were not qualified to buy home under the original guidelines. 

namb_certified_brochureDid government agencies and politicians pressure these investment houses and banks to offer these loans to give the appearance that certain socio-economic groups within our society were making headway or that lenders were not “discriminating” against minority groups or protected classes across the country?  I guess the “investigation” to be launched by many of those same politicians might actually discover some truth but it is highly unlikely that the real fault will be publicized for the sake of preserving the political future of those doing the “investigation” in the coming months.

The good news, however, in Tennessee, is that all mortgage professionals will now be held to a higher standard in the coming months and years. Each of these standards, this author has proudly far surpassed by aquiring and maintaining the nation’s highest level of certification in the mortgage industry for the past seven years.  Many Tennesseans have already experienced the benefits of working with a highly qualified and ethical mortgage professional who has taken (and taught) the classes, passed the tests and remains on the cutting edge of what is happening in the mortgage industry.  It has been my pleasure to work for those borrowers who desire and deserve that caliber of mortgage professional.

The author, Brian Short, is the nation’s only thrice certified mortgage professional. (Certified Mortgage Consultant, Certified Residential Mortgage Specialist, General Mortgage Associate)

Is your mortgage professional CERTIFIED?