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Home Lending and the Paperwork Avalanche T By Jayson Stebbins Mortgage Professional Jayson Stebbins is a 23 year veteran of the Mortgage Banking industry and an Accredited Mortgage Professional through the Mortgage Bankers Association. He grew up in Morgan Hill and currently lives in Gilroy. He is the local Branch Manager of Guild Mortgage, a 56 year old Mortgage Banking firm. His office is in Morgan Hill and serves all of Santa Clara, San Benito, and Monterey counties. You can reach Jayson and his Team at 408-782-8800 or at here is a some danger in this column. Danger that I will dissuade some from buying a home. Danger that my commentary goes against a massive, space-themed advertising campaign by a national mortgage lender. Bear with me, dear reader. Since the events of 2008, the pendulum of lending swung from the totally inappropriate back to the over- kill of documentation. It is just now beginning to show signs of easing up, but the primary warning voice today is that if you are buying a home or refinancing: be prepared. Be prepared to provide the documentation you are requested, plus some more, and maybe a little more. These requests are not, as some may assume, designed to create a maddening circumstance of annoyance. They are driven by secondary market rules, regulations, and requests. But there is light at the end of the tunnel. First to reference the “click here for approval” advertising that is going on out there. You should all know the commercials for the space travel based approval. Here is a big reveal for you: that is an offering pretty much everywhere. Any large mortgage banker has what the interstellar program offers. Most just don’t have the advertising budget. And what is missing from the marketing pitch is that is applicable only for W-2 workers, over 2 years on the job, perfect credit, with electronic verification provided by their employer and so on, and so on. It is a great offering, reducing the amount of paperwork you have to provide... but only if you fit in the tight credit box. For the rest of those buying a home, or refinancing, it can be more paper intensive. If you are self-employed, earn over 25% of your income in bonus or overtime, have a 2nd job, own investment properties, have corporations; any of these will put you into a category of high levels of documentation. And if you are a “Jumbo” buyer - well all I can say is strap in. The requirements can get intrusive, and sometimes illogical. Here is the good news: getting a loan these days is like taking an airplane ride. Your lender will get you from point A to point B, probably on time and probably with no catastrophe. However, the turbulence... well it might be rough up there. Some loans are a smooth flight on a private jet with cocktail service and private chef; while some are cattle car comfort, bumps worthy of an airsick bag, and maybe some peanuts. But you will get there... and you will have your home, or your lower rate, or that great investment property. I know there is danger in this article, but here is the thing: it is all worth it. It is worth it because chances are you are buying a home and now have all the inherent benefits that brings. Or you are lowering your rate and saving money you can use to pay down debt or create a savings account. Or you are paying off debt and feeling that liberation. And it is all worth it because when the pendulum was the other way, when we were not held accountable to document the truth of our income and our assets, when we were not as an industry being diligent, well...we know what happened. We don’t want that again. So we buckle in for the flight, we accept that for some reason they need ALL the pages of the bank statements (even the blank ones). We accept that they need ANOTHER pay stub. And we land safely with our new loan, out of danger. Jayson Stebbins is a licensed mortgage agent in CA for Guild Mortgage Company NMLS#38463; Licensed by CA Disclosure:Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act. NMLS Company Unique ID 3274; Branch Unique ID 38480. The postings on this editorial don’t necessarily represent the positions, strategies or opinions of Guild Mortgage Company or its affiliates. This information is not guaranteed to be accurate and shall not be construed as a guarantee of loan approval. All loans are subject to underwriter approval, and are subject to change without notice. Equal Housing Lender. 72 GILROY • MORGAN HILL • SAN MARTIN JULY / AUGUST 2016