Read the Full Newsletter Issue 2602

Sometimes I Don't Love Being Right

Unfortunately, it happened again this week.

But first, rewind to a couple of months ago when a prospective borrower approached me about a DSCR loan. I had some confusion about their entity documents, so I asked to review them in advance of processing a loan file. I identified some fatal flaws and carefully documented for them the what and the why of the problems.

When I followed up a few weeks later, I was dismayed to learn that they had chosen to go with another lender. In the current environment where loan originators have to fight for the privilege of writing every single file, this was disappointing, to put it mildly.

This week the prospective borrower came back.The aforementioned competitor was, in fact, not able to originate the loan, and we carefully discussed the best strategy to ensure success with me. The client is discussing with their CPA the corrections to their documents, and we will give it a fresh look together.

However, to my point—in the current environment where loan originators have to fight for the privilege of writing every single file, I encourage you to choose carefully. Consider the landscape shift:

• 192,793 licensed mortgage originators (Late 2024)

• 577,266 in 2023

• 620,518 at the historic peak in 2022

More than 2/3 of licensed originators left the industry in a two-year period. Such attrition underscores the importance of carefully vetting your originator.

I am not always right, and I don't always enjoy it when I am. But I will always give you my best effort.

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Do you have questions about DSCR loans or want a quote? Email me at [email protected], or click----> DSCR Information