Aug 26, 2015
groveslendingteam

Can You Do a Loan in Northern California? – We Can Do That

Hull Roseville

 

The team just closed on this awesome home in Northern California.  Our clients were referred to us by one of our amazing referral partners here in Los Angeles, who asked whether the Groves Team does loans outside of Los Angeles.  The answer is Yes—we are all licensed to do loans anywhere in California.  Whether you are buying or refinancing a home in Hilt on the Oregon border or San Diego on the Mexican border, the Groves Team has you covered.

The beautiful home pictured above it is located in Roseville, outside of Sacramento.  Our amazing  borrowers were fully approved upfront, which allowed their offer to be accepted without a loan contingency.  Additionally, they were able to use a loan program that came out earlier this year that allows W2 borrowers to borrow without submitting tax returns .  This made the process even faster and we were able once again to close early.

If you or a family member is looking to buy or refinance anywhere in the state of California, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Aug 11, 2015
groveslendingteam

China and Mortgage Rates

Contrary to popular belief, and the opinion that I’ve been carrying for over five years, it looks like mortgage rates are going to dip once again.

If finances bore you - here is the quick take-away.  If your current 30 year fixed mortgage is over 4.125% OR you want to refinance from an ARM to a 30 year fixed –  email me a copy of your most recent mortgage statement and I’ll see if there is any benefit to refinancing.

If you like reading about finances and interest rates, here is what is going on:

  • China just devalued their currency.  You can find the story here.  Don’t worry.  Don’t believe the talking heads who will spark a “sky is falling” media frenzy.  The financial markets are (probably) NOT on the verge of a global meltdown.

    However, with China downgrading their own currency, money is flowing OUT of global stock markets.  When money leaves stocks, it has to go somewhere.  The short term solution for money movement is a flight to safety and the buying of bonds, stocks, mortgage back securities and US backed treasuries.  As money comes in, these financial instruments can be offered at LOWER rates.  More demand means the supply can be priced cheaper.   Therefore, more money OUT of stocks and into safer securities equals lower prices, AKA,cheaper mortgages.

  • What about the prime rate? The Prime Rate, which is really only used for short term financing and is controlled by the Federal Reserve, has been at record lows for over three years.  The cost for banks to borrow short term money (think lines of credit, short term business loans and credit cards) has basically been at zero for years.  The Federal Reserve has hinted several times that this rate might be going up later this year.

    HOWEVER, what’s important to know is that the Prime Rate is NOT the same index that sets rates on 30 year fixed mortgages.  Historically, when the prime rate rises, there is a knee-jerk reaction for money to come OUT of the stock market.  Investors get worried about higher business costs, short-term borrowing costs and inflation.  As we mentioned above, guess where investments go when money comes out of stocks?   They move to bonds, mortgage backed securities and US Treasuries.  Again, this pushes prices DOWN and mortgage interest rates drop.

  • What if we really are looking at a global slow-down?  Guess what, nothing WE can do about it

The US Government however WILL do something about it and will probably find additional ways to keep rates artificially low (as they’ve done in the past with Quantitative Easing).

As always, if you have any questions please call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Aug 11, 2015
groveslendingteam

How To Introduce Your Lender

As a team we are grateful for every single lead we receive from our Realtor partners, past clients, other loan officers and local professionals.  Without referrals, there would be NO way for our business to thrive.

However, after closing thousands of transactions over the last 14 years, I have come to find that there is a good way and a GREAT way to introduce a lender.

Use the word BECAUSE - “I trust Scott Groves and his team BECAUSE they always get the deal done.”  “I’m actually not sure what rates and fees are right now on a mortgage, however, I use Scott and his team BECAUSE they’ve always treated my clients fairly.”  “I use Scott, not because he’s a great salesman, but because his team really cares about making sure you buy a home you can afford.”

Thanks to radio, TV and internet ads, clients think that the only variable in a mortgage professional is the rate.  You know that nothing could be farther from the truth.  Rate is important, however, did you know that nearly 30% of escrows in America STILL fall apart due to financing and appraisal issues?   I want my team and the company I work for to be known as the group that cares about clients AND closes deals.  Getting the best “deal” is secondary.

Speaking of which, PLEASE introduce the Team-  Recently I got a YELP review that went something like this – “5 out of 5 stars for the team, closed early, great rate, all questions answered by members of Scott’s team in a timely manner.  Process kept me well informed.  However, Scott didn’t answer his phone every time I called, so I give him 3 out of 5 stars.”

My first reaction was that I was angry.  My thoughts were, you got all your questions answered, we closed early, I’m your loan officer, not your boyfriend.

Then, after I cooled down, I realized that the fault for this review was mine.  I have NOT done a great job in the past of explaining my role as a loan officer (think football coach) and the role of my team (Loan Officer Assistant – think quarter-back, Loan Processor – think running back, Escrow officer – think offensive line pushing to get things done, Title Officer – think defense).

I’m currently developing an email + video + phone call script that will go to each new borrower explaining my role and the role of the team.  It truly does take a village to raise a loan.

If you, as the Realtor, can help set the table by introducing the “team” concept, we can ensure that the client experience meets the client’s expectations.

Introducing three lenders - Ah, my favorite urban legend.  I get it, I never want to be sued either.  HOWEVER, there is absolutely NO legal precedent for getting sued if you don’t introduce three referral sources, it’s urban legend.  As long as you refer people whom you know to be honest professionals, you absolutely cannot get sued for the actions of the individual you refer.  Conversely, if you openly refer a service provider who is known to have unethical business practices, then it doesn’t matter if you referred three or three hundred different crooks to pick from, you can still be held liable.

Beyond the issue of the law, I still get it.  Realtors and other professionals seem to feel that by giving three referrals – if something goes wrong, then the client will take on the personal responsibility for having made that poor decision.

Unlikely!!! I’ve NEVER heard a client report back to a Realtor – “thanks for the three referrals, that loan process was really horrible.  However, I don’t hold you accountable though Mr. Realtor as I know I’m the one who picked the wrong lender of the three referred”

Pick a great lender, deepen that relationship and I promise you your deals will get easier and close quicker. 

As always, if you have any questions please call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Jun 29, 2015
groveslendingteam

The Rate Shopper

Today I wanted to talk about one of my favorite types of clients - The Rate-Shopper.  Hey, I get it, I’m a consumer too.  When I go buy a car, I look online to ensure I’m getting a decent deal.  However, at some point, trying to find the “best deal” ends up being counter-productive and tends to lead me away from the “other” things that matter.  Customer service, maintenance packages, quality of the service department at a specific location and ease of the completing the purchase are all things that SHOULD be considered when buying a car.

Unfortunately, in our compare-everything, commoditized world – consumers forget that there are some processes, like buying a home, where there is a lot more at stake than just the “rate”.

So, let’s talk about the rate  -  When I do lose a client due to rate, it’s usually because of a 0.25% difference (clients rarely care about 0.125% and any two lenders are rarely part by more than 0.25%).  Contrary to popular belief, no one really has any idea why B of A, or Quicken, Akron Ohio Federal Credit Union or any other financial institution happens to have a lower rate on any given day than other lenders.  Maybe, on a certain day, business is slow, so B of A drops their rates to try to attract more business.

Whatever the reason, 0.25% on a $540,000 fixed mortgage (currently my average loan amount) equates to about $78 a months.   What I frequently hear is that $78 per month x 360 months is $28,080.  Sorry Scott, I don’t care how highly recommended you come and how much work you’ve done up front, $28K is $28K.  Ok, fine, assuming you, the consumer is not falling prey to some type of bait-and-switch sales pitch (which is often the case), then go ahead and go with the other lender.     

HOWEVER, keep in mind…  that the average American is completely incorrect about his assumptions about how long he will be in a house.  Although 95% of mortgage applications in America are for a 30 year fixed, just over 90% of Americans will NOT have their current mortgage 10 years from today.  The average American, EVEN with rates as low as they’ve been for the last decade, has historically only kept his mortgage for 6.7 years – about 80 months.  Upgrading, down-sizing, refinancing, foreclosure, paying off a home in full, distressed sell – 90% of our clients will not have their house for more than 10 years.  They definitely won’t have their same mortgage.  Now all of the sudden, that $28K is really $78 per month x 80 months = $6,240.  Still, $6K is a lot of money.  However, it’s probably not enough money to start the loan process over on day one of escrow with an unknown lender.  Remember, the lender taking that rate-shopper call does not have all the borrowers information (credit score, scenario, underwriting approval and source of down payment – all things that can affect the rate).

Cautionary Tale #1 -  Recently, I had a client ditch me on the day we opened escrow due to a 0.25% difference in rate.  Mind you, the client lived out of the state and one of the reasons the listing agent accepted the offer was because he had a high level of trust in my ability to close the deal.  The client went with a lender whose name rhymes with Mel’s Cargo.  Here are the problems he encountered.
1)  An out of area appraiser was assigned to the property and appraised the property low.  Borrower had to bring in tens of thousands of dollars in extra cash to bridge the gap of the appraisal deficiency.   2)  Lender required Earthquake insurance.  This was insurance the client didn’t intend to purchase and will now cost him an extra $1,200 per year that he didn’t plan on spending.   3)  The day escrow was supposed to close, the client found out that the appraisal had just been reviewed (something that happens at Movement Mortgage within 24 hours of receipt of the appraisal), and the bank was requiring several thousand dollars of repairs and follow-up inspections prior to the close of escrow.   All and all, to save $94 a month with that “lower” rate – this client is parting with an extra $40,000 in the first year of home ownership that he wasn’t planning to spend.

Cautionary tale #2 –  My team is good.  REALLY good.  From my loan officer assistants, to our processors, to our underwriters; our team knows how to structure a deal.  While still staying within the guidelines of Fannie Mae and Freddie Mac – our team has become experts over the last 14 years of packaging loans for self-employed buyers and those who work in the entertainment industry.

Recently, I had a client ditch me for a broker who was promising a rate, on an investment purchase, of 0.375% lower.  At a savings of $237 a months – I TOLD the client to ditch me and go with the other guy as long as he had the rate lock in writing.

Fortunately for me, and unfortunately for the borrower, I got this deal back two weeks later.  Turns out the appraisal came in low AND, more importantly, the other lender had miss-structured the deal.  In order to have the buyer qualify for the loan – which I already had approved – the other lender required the borrower to “pay” himself an extra $100,000 from his business account to his personal account.  The transfer of these monies resulted in roughly $30,000 of payroll tax.  Payroll tax that could have been partially avoided had the borrower stuck with our original approval here at Movement Mortgage.   To save $237 in tax-deductible interest payments, the client paid roughly $30K in income tax he didn’t need to.

As always, if you have any questions please call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com
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Jun 5, 2015
groveslendingteam

Guideline Changes = Saving Money

Bauer eagle rock courtney poul

The team just closed on this Spanish style home with an amazing view in Eagle Rock.

Often we warn clients that their CPA and our underwriter have completely different jobs.  The CPA is trying to write off as many expenses as possible to minimize the client’s taxes.  By contrast, our underwriter is trying to add money back to the client’s income for the purpose of qualifying and has to remove deductions from the income.  As you can imagine, having a lot of deductions can really reduce the client’s usable income, and thus the approved loan limit.  This was the case with the buyers of this home. Due to tax write offs, our clients would normally have had to put 25% down to close the loan.  However, thanks to recent guideline changes, we only need to use paystubs instead of tax returns when a client is a W2 earner.  Because of this new change, our clients only needed to put 10% down, which allowed them to direct the additional funds towards upgrades.

We had the pleasure of working with Courtney Poulos from ACME Real Estate.  She was there every step of the way to keep everyone on track throughout the escrow process.  If you are looking for an agent in Northeast Los Angeles, the team highly recommends Courtney.

If you are a W2 employee and have tax write-offs, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Jun 5, 2015
groveslendingteam

Close A Jumbo Loan In Under 20 Days – We Can Do That

goldwasser highland park

 

The team just closed on this beautiful craftsman in Highland Park.

We tell all of our clients that we can close fast as long as they get us all of the required documentation upfront.  Once again we had a client that did just that and we were able to get them fully approved upfront.  Before you say, “well you do that with everyone, why is this a big deal” the reason is that we were able to get this done with a jumbo loan.

Jumbo loans are typically trickier loans because of the added guidelines and overlays that are attached to it.  Because of this most lenders close a jumbo loan between 30 and 45 days.  We were not only able to fully approve the file upfront so that the offer was written with no loan contingency, but we were also able to close this loan in 11 days.  You heard that right!  We were able to close a jumbo loan in only 11 days.  Here at the Groves Lending Team, loan turn times like this are the new norm for us, but as always we did have some help by an amazing buyers agent.

Blake Hood from Atwater’s favorite realtor team Kurt and Courtney was instrumental throughout this process.  He was able to keep his client focused the entire time and more importantly was able to snap the listing agent out of shock when he heard we were closing in only 11 days.  If you are looking for a phenomenal agent to work with, the team highly recommends Blake.

If you have any questions regarding jumbo loans and which might be the best for you, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Apr 8, 2015
groveslendingteam

Increased Equity = Remodel

Loesh highland park refi

 

The team just closed escrow on this Highland Park refinance for which the team did the original loan for two years ago.   It is amazing what can happen in two years, especially in a neighborhood like Highland Park.  Because of rising home values, our borrowers were able to do a cash-out refinance for a large remodel and still have more than enough equity to avoid mortgage insurance.

This was a win-win for our clients: funds for a remodel, a lower interest rate and no mortgage insurance.

If you are planning a remodel, or just need cash, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com and see if a cash out refinance will work for you.

 

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Apr 6, 2015
groveslendingteam

We Love First Time Homebuyers

l7c460c45-m0xd-w640_h480_q80

The team just closed on this Highland Park condo.

We always feel fortunate to help first-time homebuyers achieve their goal of homeownership.  Our borrower was able to provide us with all of the required documentation upfront and all underwriting conditions within an hour.  When the offer was made, our borrower was completely approved so he knew the absolute maximum sales price so he could offer without any hesitation.  And thanks to the agent’s help we were able to get the condo approved before the initial offer was even made.  It is a great feeling to be able to tell a first time buyer that the loan and the condo complex is 100% approved, and that as long as inspections come back positive, the unit is his.  This is the reason why we love our job so much.

We and our client were extremely lucky to work with the one and only Adam Bray-Ali.  Adam was able to get us everything we needed super-fast.  He was also responsive and reassuring throughout the process, making the overall experience for our client amazingly easy. The team highly recommends Adam for all of your real estate needs.

If you are a first time homebuyer and want to have an advantage over everyone else, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Apr 2, 2015
groveslendingteam

Closing Early Is Always Good

Rowinski NOHO B christy lindgren L scott nell

The team just closed on this adorable home in North Hollywood.

As with many of our loans, this one closed in less than 30 days. It shows that when a borrower provides us with all of the required documentation up front, we can get a loan funded very fast.

Between the helpful buyers’ agent – Christy Lindgren at Bond Real Estate–  and a sharp listing agent – Scott Nell of the Scott Nell Team– we were able to close escrow early.

If you want a stress free escrow that is lightning fast, call Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

 

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Apr 2, 2015
groveslendingteam

Condo Pre-Approval

Funnell Los Feliz B john david forsyth L mica cambell

The team closed on this condo in Los Feliz. 

We have successfully funded several deals in this complex; the reason we are the go-to lender is our condo pre-approval process.   As you know, when it comes to condos, if any information when it comes to the HOA, most lenders (especially the big banks) will deny the loan.  With our amazing condo pre-approval process, when buyers find a condo they wish to write an offer on, the agent only needs to provide three pieces of information to us: We need the name of the complex, and the contract person’s name and phone number. That’s it.  From this information, we will know if the complex you are writing on is approvable.  Once a condo is approvable—whether this particular buyer goes into escrow or not — the complex is added to our list of approvable condos.   Having everything pre-approved allows us to either go into a new escrow on a complex that is new to us and know it’s approved , or allows for the next escrow on the building to move even faster and more smoothly.

We worked with John-David Forsyth on the buyers’ side and Micah Campbell on the listing side.  Both agents were integral in helping our escrow to move smoothly from start to finish.  If you want to buy in Hollywood and its surrounding areas, our team highly recommends John-David. If you are looking to sell in Los Feliz and its surrounding area, the team also highly recommends Mica.

If you have any questions about condo financing or our condo pre-approval service, you can reach Scott Groves @ 818-679-5188 or apply online at www.LendLA.com

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Scott Groves     |     Your Trusted Lender

Groves Lending Team

A Los Angeles based lending team specializing in conventional and FHA purchase mortgages. The Groves Lending team can manage the entire loan process providing clients with efficiency and accuracy.

818-679-5188
(7:00am-7:00pm / After hours)