I Did Something I NEVER Do

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I Did Something I NEVER Do



     The market took a wild ride this week, brought us the lowest rates we've seen in quite a while (which inspired this blog), made the phone ring a few more times than usual, and opened the door for a few previous clients to knock PMI right off their loans (Winning!).

How to get the best mortgage rate


     While this week's news on plummeting rates was exciting, I kept a few market "rules" in the back of my head as things started looking better and better.  For one, Friday is traditionally a bad day for mortgage rates.  Fridays following a week full of improved bond pricing are traditionally even worse.  Fridays following a week full of improved bond pricing and preceding a long holiday weekend are even worse than the preceding 2 scenarios.



      Oh, and that pesky stock market.  When the stock market gets absolutely hammered like it did the past week, there's (almost) always a reaction that those in the marketplace like to refer to as a "dead cat bounce".  Don't worry Dead Cat Bounceabout visualizing where they came up with that phrase.  I digress...a dead cat bounce is an opposite reaction to a steeply trending market movement.  Since stocks were down, down, down Monday thru mid-Thursday, traditional wisdom said the dead cat would indeed bounce and stocks would rebound today.



     Herein lies the problem with people trying to "catch the bottom" of the market, or get the "best" rate.  The market is usually in a position that's a couple of hours (at best) from at least a short term reversal.  That couple of hours is almost ALWAYS in the middle of a borrower's work day, at their busiest time, and when they can't reply to emails or answer the phone.  The trouble becomes, it's a clients decision to lock, not mine.  So something I NEVER do is lock someone into a rate that they haven't confirmed they want.  Yesterday, though, I did it.  I predicted today would be a pretty rough day for interest rates (see those traditional "rules, above), and the DOW showed a reversal yesterday from down 400 points to down just more than 200.  As I saw the trend begin to reverse, I got on the phone to make the "we should lock" phone call.



     Of course it was the middle of both clients work day, at a time when they weren't answering phones and couldn't respond to email.  Both of their loan amounts were large enough that even a change of .125 in the markets would result in hundreds of lost dollars.  Both were past clients with whom I have great rapport.  So I made a decision to do something I NEVER do.  I locked them both into rates without their OK to lock in.



     When they finally got back to me, I apologized.  "Mrs. Borrower, I don't normally do this, but I locked you into an interest rate".  My apology was sincere, but more of a "sorry not sorry", as I then explained I was able to lock in a rate .125 better than we'd discussed the previous evening, with a lender credit of more than $1000 over what we had initially discussed.  



     I had a similar conversation with the other Mrs. Borrower.  Locking in without permission saved her and her husband about $800.  They were both pretty OK with me making an executive decision on their behalf.



     I'm a strong believer that ASSuming things isn't a good idea, and I don't like to make financial decisions for people, ever.  I believe in being a guide, educating people on options, and letting them make their own decisions, for better or worse.  But sometimes, you've gotta do what you've gotta do.  In this instance, I'm glad I was able to save these folks money and use my market experience to make the right move.



In the mortgage industry, experience counts, and in a market as volatile as todays, it's even more important than ever!


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Bruce Brockmeier
Internet Marketing Consultant to REALTORS® - Yorba Linda, CA
Coached By Crouch

Well done John Meussner

You know what "they" say.  NEVER say NEVER!  

Feb 16, 2016 05:41 AM #28
Jeff Dowler, CRS
eXp Realty of California - Carlsbad, CA
The Southern California Relocation Dude


I suspect we have not yet seen the bottom, but what do I know.

If you are trusted by your clients and have done all the due diligence, are making a good decision, and have tried to reach the clients, then I think it's fine. I would have been happy, personally.


Feb 16, 2016 06:04 AM #29
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

A well deserved feature and a topic that is so important. You understand this business very well and your clients are fortunate to be working with you.

Feb 16, 2016 06:19 AM #30
Bob Ratliff
Robert Ratliff Realty - San Antonio, TX
"Sold with Bob"

I think you did the right thing looking out for your buyers best interest and saving them money. You would be my rock star if it had been my loan....

Feb 16, 2016 06:46 AM #31
LuxurySoCalRealty Compass San Diego
Compass - La Jolla, CA
San Diego Partner - The Private Client Network

Hi John i remember when I was a lender and floated the customer at my own risk.  I lost quite a but one day when his market fell fast and locked immediately after client gave written or verbal commitment.  Glad to hear you saved your clients money. 

Feb 16, 2016 08:46 AM #32
Olga Simoncelli
Veritas Prime, LLC dba Veritas Prime Real Estate - New Fairfield, CT
CONSULTANT, Real Estate Services & Risk Management

Every 1/8 makes a difference, however slight on a monthly basis.

Feb 16, 2016 09:42 AM #33
Evelyn Johnston
Friends & Neighbors Real Estate - Elkhart, IN
The People You Know, Like and Trust!

I would have been happy that you locked when you did too. A bargain is a bargain!

Feb 16, 2016 10:12 AM #34
Marco Giancola
Beachfront Realty - Miami Beach, FL
Realtor (305)608-1922, Miami Beach Florida

Hey John, gutsy move but I am sure the customer was pleased with the result.

Feb 16, 2016 10:22 AM #35
Barbara Altieri
Kinard Realty Group Fairfield and New Haven County CT Real Estate - Shelton, CT
REALTOR-Fairfield County CT Homes/Condos For Sale

Sometimes you have to do what you have to do, John. You understand what was happening and made a great call for your clients. I'm sure they're thrilled.

Feb 16, 2016 11:07 AM #36
Elizabeth Weintraub Sacramento Realtor Top 1%
RE/MAX Gold - Sacramento, CA
Put 40 years of experience to work for you

We all think you did the right thing but could you have gotten into deep and serious doo doo for doing what you did? Are you allowed to do anything like this without client permission? What if it backfired? I mean the only time, truly, that you have to do what you have to do is if you're required to shoot somebody else in order to survive, LOL.

Feb 16, 2016 11:16 AM #37
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

I am glad that all worked out for all.  It looks like things will be going up and down for a while.

Feb 16, 2016 11:41 AM #38
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

I believe it's a good think when the loan officer does something that is in the best interest of the client. 

Feb 16, 2016 01:11 PM #39
Dorie Dillard CRS GRI ABR
Coldwell Banker United Realtors® ~ 512.750.6899 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning John Meussner ,

It's obvious to me you are a loan officer who takes your role seriously and are in close contact with your clients. You are right, experience counts and once again you made the right executive decision!

Feb 16, 2016 07:43 PM #40
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

You are right that consumers rarely ever land the very best ! By the time they react the market has started moving away from the bottom !

Feb 16, 2016 09:58 PM #41
Nicole Doty - Gilbert Real Estate Expert
Zion Realty - Gilbert, AZ
Broker/Owner of Zion Realty ZionRealtyAZ.com

John this doesn't shock me at all that you would roll the dice like this. You know exactly what you're doing. You knew you had a good enough understanding with those clients that you were willing to take the risk of locking in their rates without their approval. Some gambles are worth taking and you've been at this game long enough to know which ones to take. 

Feb 16, 2016 10:38 PM #42
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

Here's a thought, why not ask for the "permission" when you have the initial conversation with them after you have their mortgage application in process?  That way if rates dip, you can lock them in with their permission, which you explained to them earlier that you might do exactly that,and they "Oh, that would be great!"  

Feb 18, 2016 03:46 AM #43
DEANNA EARLY - - ( NMLS # 268590 )
American National Bank & Trust - Smith Mountain Lake, VA
Highest Ranked Mortgage Loan Originator Virginia

We all have to make decisions from time to time John Meussner and I am glad this one had a positive outcome for you.

Feb 18, 2016 04:04 AM #44
Susan Hale
Re/Max Realty of Defiance,Inc. - Defiance, OH
Re/Max Northwest Ohio Realtor

Good article and informative comments

Feb 18, 2016 05:38 AM #45
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

But you never know, locking a rate can be tricky. It is jumping all over the place...

Feb 18, 2016 10:09 AM #46
Winston Heverly
Winston Realty, Inc. - Atlantis, FL

I enjoyed your informative post, glad I came across it in the archives.

Mar 12, 2016 11:52 AM #47
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John Meussner

#MortgageMadeEasy Walnut Creek, CA 484-680-4852
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