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MortgageCast #11: John Mauro | A Lifetime of Mortgage Experience

May 3
10:45
AM
Category | Podcast

MortgageCast #11

John Mauro | A Lifetime of Mortgage Experience

MortgageCast #11 with John Mauro

In this episode, Tom and I welcome John Mauro to the show. John is the Vice President and Co-founder of Greenway Mortgage.

Our conversation is an in-depth look at what happens behind the scenes and what it takes to operate a direct mortgage lender like Greenway.

There are many aspects a typical client is not exposed to that makes approving, closing and funding a mortgage possible. My clients get to know my team and me best along the way but we are but a tiny cog in a very intricate framework that includes government entities, various financial institutions and a host of Greenway employees working diligently to get loans to the closing table and beyond. John, along with our President James, is at the helm overseeing the daily operations with a keen eye towards the future.

There's a lot of industry terminology discussed so be sure to check the show notes here.

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MortgageCast #10: Financing Your Home Renovation Project

Mar 2
6:45
PM
Category | Podcast

MortgageCast #10 | Benefits of a Renovation Loan

The Renovation Mortgage Process, Renovation Loan Consultant, What Can The Borrower Expect & More!

In this episode of MortgageCast, Erin the Expert discusses the many benefits of using a Renovation Loan to purchase a home in need of repair or to upgrade one you already own.

She starts off talking about renovation loans from the perspective of a purchase transaction and then throws in some info towards the end of the conversation about financing renovations on a property that you already own.

In both types of transactions you are able to borrow against the property’s future value after the improvements to the property are made, which creates immediate equity for the purposes of the loan application.

Primary residences, second homes and investment properties can all be financed with a renovation loan – but these are all meant for homes you are going to hang on to for a while and not for fix and flip projects.

And there's a big difference between renovation and construction loans. With a renovation loan, you are repairing or upgrading an existing home while a construction loan is meant for going ground up – taking an empty lot and building a new home on it.

There's also a common misconception that there is a loan to purchase the home and another for the renovations. A renovation mortgage is ONE loan finances both the purchase of the house, and the costs to renovate it.

The Renovation Mortgage Process

The first step, just like any normal purchase, the buyer and seller agree on the sales price and enter into a sales contract.

What differs is that the buyer obtains an estimate from a contractor for the work that needs to be done.  It is important to note that the borrower is not permitted to do the work themselves, and MUST hire a licensed and insured contractor.

In processing the loan application, we add the sales price and the cost of the renovations from the estimate to come up with a total acquisition cost of the home. The down payment is based on this figure. For example, let’s say the sales price is $200,000 and the renovation costs are $50,000. The down payment will be based on $250,000. So for a 10% down transaction, the down payment is $25,000.

The Loan Consultant

If the renovation costs exceed $35,000, a renovation consultant is required.  The consultant is an independent third party that works for and on behalf of the buyer. Essentially, they are a project manager and facilitates the process between the borrower, contractor and lender. The consultant will come out to the house to look for any possible defects in the property that aren’t addressed by the estimate and will make sure that what IS listed in the estimate will meet minimum property standards for loan approval.

What else can the borrower expect?

Basically, business as usual… not only does the lender need to approve the renovation project, but we do need to review the borrower’s income, assets and credit profile. Once both the credit and project approvals are issued, the borrower will be cleared for closing. It is important to note that given all the work involved with renovation mortgages, the turnaround time from start to finish is a bit longer.

What happens at and after closing?

The loan funds are disbursed at closing – the seller gets their contracted purchase price, and the remainder of the funds are placed into an escrow account that is managed by the lender. Payments called draws are made to the contractor as work is completed. The consultant or an appraiser will come out to the property to make sure the work has actually been done, then a draw check will be issued.

What if the contractor requires money to get started on the project?

The lender can disperse up to 50% of the cost of the materials  (NOT including labor) to get the project started. All other draws will be issued as work is completed.

How do renovation loans work if you already own your home?

There are a number of different ways we can look to tackle this. The easiest way is to take out some cash from the home’s equity to cover the costs of the renovation project. We would do a standard “cash out” refinance transaction and pay off your existing mortgage then hand you a check for the remaining proceeds at closing.

What if there is no equity in the house? Can someone still finance a renovation?

Yes, and it works similarly to the purchase. The homeowner will get an estimate from the contractor – we’ll send a consultant out if needed and the appraiser will inspect your home. The as-is value will be determined, and then the renovation costs will be taken into account to come up with the “end” value. We’ll lend off of that figure when determining the maximum available loan amount and cash that can be disbursed for renovations.

What is required of the contractor?

The estimate the contractor provides needs to be very detailed. It has to separate out the costs of the materials from the labor so we can determine how much money to disburse at closing. Aside from filling out a bunch of paperwork, the contractor will need to provide copies of their license and insurance policies.

Renovation Mortgage Programs

Additional Resources

Are you a first time home buyer?

Consider downloading our FREE homebuying guide specifically for those new to the process. It's packed with useful information, checklists and tip sheets to get you off on the right foot.

Are you ready to take the next step?

It's time to get pre-approved with Erin the Expert!

 

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MortgageCast #9: Homebuying Strategies | Day 1 Certainty, Layered Risk and TBD Approvals

Jan 14
9:32
AM
Category | Podcast

MortgageCast #9 | Homebuying Strategies

Day 1 Certainty, Layered Risk and TBD Approvals

Being a home buyer in the current market can be challenging. Luckily we have tools, resources and strategies to be sure our clients have the best chance of securing a home and mortgage.

It's been a bit since the last MortgageCast was released but Erin the Expert dives deep into the tools and strategies she uses to make sure her clients have the best shot at buying the home of their dreams. This one is a bit longer but there are many important concepts to be learned. The mortgage business is ever changing and technology is advancing rapidly so being aware of it and knowing how to leverage it is an advantage Erin and her team have over other mortgage lenders. When you're ready to start the home buying (or refinance) process be sure to reach out to me directly.

by Erin the Expert

Day 1 Certainty (D1C)

Layered Risk

TBD Approvals

Additional Resources

Are you a first time home buyer?

Consider downloading our FREE homebuying guide specifically for those new to the process. It's packed with useful information, checklists and tip sheets to get you off on the right foot.

Are you ready to take the next step?

It's time to get pre-approved with Erin the Expert!

Contact Erin Directly

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MortgageCast #8 | The 4-Cs of Qualification

Nov 23
9:06
AM
Category | Podcast

MortgageCast #8 | The 4-C's of Qualification

WHAT DOES GREENWAY LOOK AT TO DETERMINE IF A CLIENT IS QUALIFIED FOR A MORTGAGE?

It's called the 4-C's of mortgage qualification: Credit, Character, Capacity and Collateral.

In this latest MortgageCast from Erin the Expert, she walks us through what each is as well as what sorts of things might reduce a client's purchasing power.

by Erin the Expert

The mortgage process can be daunting, especially the early stages of qualification! We ask many questions that may not seem to relate to a mortgage and request a significant amount of documentation. Guidelines have become more stringent to ensure the borrower is given a mortgage they can afford. Understanding the underwriting process can help ease stress and streamline the effort. In general, mortgage lenders like Greenway observe the 4Cs of borrower qualification – Credit, Character, Capacity and Collateral. Since every client’s financial situation and scenario varies, the 4Cs help Greenway determine if a particular borrower and property are mortgage-worthy. 

You can get more information on qualification and the mortgage process by watching some of my other videos and blog posts. Check the show notes below for links to those.

I hope you enjoy and I am always ready to answer any questions you may have.

And when you're ready to start the home buying (or refinance) process be sure to reach out to me directly.

Show Notes

Contact Me Directly

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MortgageCast E7 | John A. DeSantis Jr, Purveyor of Good Deeds

Oct 15
5:35
PM
Category | Podcast

What is title insurance? Why do you need it? How do you get it?

Erin the Expert welcomes her first guest to MortgageCast, long-time friend and colleague, John DeSantis Jr.

John is a Licensed Title Producer since 1989 and Closer with All Ahead Title and has literally closed thousands of real estate transactions throughout the State of New Jersey in the past 30 years.

We get deep into the details about title insurance and how John works closely with his clients and their agents to deliver a great experience for all involved and help put homebuyers at ease.

Among other things, we talk about:

  • Genealogy and heir hunting
  • Buyer vs. Lender title policies
  • Easement issues and claims
  • The title process from beginning to end
  • Settlement services and his personal touch
  • How he works with his teams of Realtors, Lenders and Attorneys
  • Why the client is the MVP

 

John A. Desantis, Jr.
All Ahead Title Agency
407 Pine Street, Red Bank, New Jersey 07701
‭(908) 675-7000‬

John's Bio

I hand hold clients and close real estate transactions effortlessly.

I started my career in Title Insurance long before I even knew it... My mom, Liz, was a title searcher and used to bring me into the Hall of Records when I was five years old (she says it was because no one could watch me during the day but I think it was just to help her pull books..no computers back then). What she didn't know back then was that she would later become my office manager!

My Uncle and mentor, Nick Beres (rest in peace Uncle Nick), was a title searcher, genealogist, title perfectionist (among many other talents) and took me under his wing when I was young. He had me coloring his many-layered Deed plottings before I hit 3rd grade. He took me all over the United States searching for heirs of New Jersey property owners to clear title. He taught me how to search titles (the right way). He served in the U.S. Navy and Merchant Marines and taught me how to run a business like a tight ship. He taught me honesty and integrity and for that, I couldn't thank him enough.

I founded Meridian Title Agency Inc. in 1989 with those same values and have helped thousands and thousands of homeowners purchase and refinance their homes and businesses. It was based on strong relationships, word of mouth referrals and doing the right things the right way. Quite simply, honesty, communication and trust are the foundation of any relationship and those values will never change. I chose to give up the administrative end of the business and found a new home at All Ahead Title as they have the same values I was brought up on and have an amazing team.

I am a guest lecturer at Brookdale Community College and Fairleigh Dickinson as well as lecturing for the Academy of Continuing Education for the Professions and the New Jersey Legal Training Academy and a proud member of Coastal LeTip of Colts Neck.

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