All Forum Posts by: David Weintraub

It was to him.  

Btw, you live in Cary?  Home of Appraisal Nation?  

Mind cracking some skulls for me over there?  :-) 

 Are you suggesting the same scenarios play out among accountants as they do HMLs?  

 I'm speaking about $50-200, max.  I've heard of these yahoos charging points upfront, which is crazy.

And I'm only saying to do so once there's a firm commitment, like ordering an appraisal, etc.  Because there's a chance the deal falls apart after the appraisal, and it's not like there wasn't office staff working on this.

Keep in mind, a loan officer like myself wouldn't see a dime of this money. 

@Jeff S. If you think all loans end in days, then you're either the smoke blower, or just smoking.

There are often times that a variety of issues come about which extends the process. For example, we worked on a loan for a couple of weeks in Allentown, which was a refi, appraisal was done/paid, but the owner didn't disclose to the city his plans for expansion.  Sparing the rest of the details, at closing the borrower decided to walk because he thought he was receiving "X" amount on that day, when he was receiving "Y" amount + rehab funding.  He was actually getting a great deal, but seemingly he was trying to use the money for something other than his stated goal.  

Soooo...after weeks of dealing with this man, he didn't close on the day of.  Should he have been charged a fee?  I mean, the processor(s) dealt with this guy constantly, and that's how they're paid.

Ultimately, he wasn't charged.  I said he should be.  

It's not a common thing, per se, but it happens.  And it's not an outlier either.  Loans are not failing to often, but the point is, I can understand the point of charging a borrower "upfront" before a loan is closed.  I'm not suggesting on day 1, or day 2, or after nominal work has been done.  Read more. 

 Seemingly, you're the master of the craft...

Charity Basketball event, 3 on 3 tournament, for anyone involved in Real Estate, regardless of what job, or what level.  $50 per team.  Should be a lot of fun.

June 16th, 9:30 AM, 300 South Broad St, Elizabeth, NJ

Link to video for Charity event

1. Five players minimum per team
2. Must have 1 female player
3. Games will be 3 vs 3 on a half court
4. Games will be 15 mins long
5. Winning team will advance to next round
6. Each team will play minimum 2 games
7. All participants must be licensed in the Real Estate industry, such as:

• Real Estate Sales Agents
• Loan Offices & hard money lenders
• Title agents
• Insurance agents
• Lawyers
• Appraisers
• Inspectors
• Surveyors
• Licensed construction contractors
• Notary
• Stagers
• Instructors

I have often read people post things like, "Lenders shouldn't charge upfront fees...if they do, RUN!"  And for a period of time I seemed to agree with this.  I have to say, I no longer do. 

Full disclosure, I work with a lender, and we don't do this, but I have advocated for them to start doing this.  And  the reason is obvious.

I don't think a lender should charge anyone during initial consultation, explanation of what they do, their rates, terms, fees, nor when they give them a general idea of how much they'll lend on a property.  However, once a lender has agreed to fund your deal and issued some type of terms, and now plans to order an appraisal, they should charge the borrower something.  It could be $50, $100, $200.  I don't know what the number is, but they should charge something.  

The reason being is, "time is money."  Lenders are working on your loan, which means they're not working on someone else's, nor are they trying to drum up more business.  What SOME borrowers do, and by no means is this everyone, or even the majority, is they get a lender to commit all of this information, terms, etc, and then they go and shop it.  At this point, the final lender has a lot less work to do because often the previous lender has done a lot of the early grunt work, which the borrower forwards onto the next lender.

But more than that, some lenders don't charge the fee until closing, which means the entire staff has been working on this loan for weeks, only to see it disappear.  It happens.  Borrowers walk away.  And the people who are working on the loan have an expectation they will get paid, and should be paid.

Again, I don't know what the correct upfront fee is (after lender agrees to the deal), but I do believe it should be something. So this idea that a lender "should NEVER charge upfront fees" is completely wrong to me.  It'd be like sending a contractor the scope of work, having him go out and price all the materials, maybe even purchase some, and then saying, "we found another contractor."  The contractor worked.  

Once a lender commits, a borrower should commit. And if the borrower then bails after a good amount of work has been done, a borrower should pay something.

My two cents.