How Bad Mortgage Estimates Cost Homebuyers Thousands | Jon Wilson

Jon Wilson (00:00)
Consistency is key. I’m marketing every day and not, and they’ll forget about you. This is another one of those subjects that I like I’m very passionate about and I can I can go on hours about this. So I take the philosophy of, one of my relationships I used to have before I transitioned to a different company was they told me I would never be a preferred lender to this but to this relationship.

I said, great. I’ll see next time and I was going there knocking like bringing you know marketing material, flyers and stuff every week, every Tuesday morning or back then it was Wednesday afternoon because that’s when they were ever all everyone was in the office. And they said, You’ll never be a lender to us. I said, Great, I’ll see you next week.

Issa Hanna (02:08)
Welcome back to the Real Estate Pros Show. I’m your host, Issa Hanna and today I have Jon Wilson, a lender who’s here to share his knowledge and philosophy about the financial world and the real estate industry with us. Jon, welcome to the show.

Jon Wilson (02:21)
Thanks for having me, I appreciate it.

Issa Hanna (02:23)
Appreciate having you. Super excited to talk to you. We talked earlier. Super experienced loan officer and also somebody that cares about his clients. So with that, Jon, can you run down your like day to days, what you’re doing day to day right now?

Jon Wilson (02:40)
Yeah, so in this world and in this industry, my day-to-day changes every day. You know, you can go in planning A through D or A through F, but you have to throw in a couple extra like A-point-one, you know, whatever the case comes in, but your day changes every day. But typical day for me is to wake up. For me is get my kids fed and ready to go. During summertime is a little more difficult since my wife’s a teacher and she, I don’t know, you might be able to see her walk behind me here at some point, but

You know, typically it’s making sure that family’s set up and then I’m on the either checking my emails, responding to them, planning my day out, and then hitting the road the majority of the week to you know visit real estate agents, builders, lawyers, financial advisors, any possible avenue that could be a referral, those are what I those are my normal stops during the week. And in between that is talking to customers, setting up appointments.

It’s very chaotic, but organized chaos.

Issa Hanna (03:43)
Definitely in our business, especially when you’re you’re a successful guy like you and you’re dealing with a lot of people and you’re drumming up business, you got to be good at organizing the chaos. And you’re you’re for sure good at that with all the stuff you just described for your day to day. So applaud you for that for sure. With that, how’d you get started in the in the mortgage industry? You’ve been in for 10 years, you got a great name, you’ve closed a lot of deals. So how’d you start?

Jon Wilson (04:11)
So I was working at a national bank before as a retail branch manager. And we would send mortgage referrals probably 20 to 30 a month to our mortgage loan officers. And in the course of a tw 12-month rate 12-month time span, we probably closed two mortgage transactions as a as a retail banking branch. So I went to my leadership and said, Hey, you know, I want to take over the mortgage side. I’ve taken over three different branches, turned them all from number 15, 14, and

20 And 22 to number one, respectively, in the same market each time I took them over. Let me take over the mortgage side and you know, develop those sales teams into number one teams. They came back and said, you know, you don’t have any mortgage experience. But here’s what we’ll do for you. You can take a pay cut, you can you know, it felt it.

And and get some experience. It felt like I was going to Comcast or sorry, a one of my cable subscriber and saying, you know, I’ve been a loyal customer for two or three years now. I want to re-up and can you give me any better deals? And they say, sure, we love you, we respect you. We’re gonna raise your bill by $45 a month. So with with that mentality, I took that and went to a different company, basically took what they offered and put to another company, took a pay cut, gave up a salary to go into

One hundred percent commission into a mortgage industry.

Issa Hanna (06:24)
Wow. And and that takes a leap of faith to have, you know, to have a W-2 job where you’re getting a guaranteed paycheck. So that is definitely takes guts to do and and in our industry, a lot of people make that leap. And you know, here you are ten years down the line, like, man, that was the best decision I ever made. So you believed in yourself and what a great what a great get in the business story. I love that.

Jon Wilson (06:53)
It

Helps to have a supportive wife too. Like yeah. It I my wife is a warrior but she was very supportive and if she was worrying she wasn’t showing it.

Issa Hanna (06:57)
Yeah.

Definitely, man. When you have a good backbone at home, you know, what do they say? The man is the head, the wife is the one that turns the head where it wants to go. You know, she you know, the wife is the backbone of every household. And when you you know, when you have a supportive wife like that who who won’t add extra stress on you, and believes in you, man, that goes such a long way. So shout out to all the supportive wives and husbands out there because

You guys are are the real champs in our lives. And with that, we were talking about honest dealing. You’ve built your name with integrity. You’ve built your name by educating homebuyers and then also dealing honestly, not rolling in points and stuff like that. So for people at home, rolling in points is an industry term. I’m gonna let Jon define it for you and then talk about why he’s been so successful. So Jon, take the floor.

Jon Wilson (08:00)
Yeah, so points in in my world is or are if the the market rate today for a scenario that I’m provided is six and a half percent, I could tell you the rate’s six percent, but what most lenders or what a majority of lenders don’t do is they don’t tell you that they’re charging you for that lower rate. The points are being charged to you at closing to buy down the rate to a lower rate. So you know, typically what I do

When I provide rates to customers, I thought I provide the no point rate first because it is what’s par for today. If I’m saving you ten dollars a month, but I’m charging you five thousand dollars at closing to get there, your break-even is what fifty plus months away. The like the life the average lifespan of a mortgage is seven years. So whether you sell the mortgage or sell the house or refinance it, if you’re not breaking even, you’re throwing away money. So in my world.

I like to have that conversation to make sure you know what’s going on. And I personally go over the loan estimate, all three pages, particularly sections A and B on the second page to make sure that you understand where your money’s going, what’s going into the cost of buying the house, and that way you know where your break-even is if you’re paying points or even if you’re not paying points. So, you know, points are not bad. Every scenario is different. If it makes sense to pay points, pay them. If it doesn’t, don’t.

Because you’re just throwing away money if you don’t use them the right way.

Issa Hanna (09:32)
Definitely. And choosing a good, experienced, honest and you know, a loan officer with integrity matters because a guy like Jon will be able to explain the difference in hey, you want to pay points, this is what you’re getting. If you don’t, this is what you’re getting. You know, he’s not gonna sugarcoat it and he’s gonna tell you the upfront honest scenario. So I always say in our business.

I like surprises, but only good surprises. You know, you don’t want any bad surprises. So no. Yeah. And and Jon won’t give you any bad surprises, only good ones. So yeah. Definitely. And with that, every lender, every real estate investor, everybody in our industry has had a time where things went sideways, a real estate nightmare, a lending nightmare, if you will. Care to share one with us and then how you overcame it?

Jon Wilson (11:02)
So man, every once in a while, but like it it’s it’s pretty much a monthly occurrence, not necessarily with me, but like trying to salvage something that someone else has messed up or a loan officer. I I say this jokingly, like I hate loan officers. I am one, I hate loan officers, at least unethical ones, because I can’t tell you like the amount of phone calls I get, let’s say a typical transaction is 30 to 45 days. You’ve

Buy a house, you write, write a contract, and you’re gonna settle in 30 to 45 days. The lender up front gives you the best case scenario. You’re like, I can afford that. Three weeks in, you decide to lock a rate in, not the day of, but you lock in the rate. You get an updated loan estimate, and the lender’s best case scenario is now five thousand dollars cheaper than what the updated one is. And you don’t have it.

I can’t save a deal in most cases when you’re that far into the transaction. Or it’s difficult for many lenders to save a deal that far in a transaction when you’re closing a week or two and now we’re trying to save it. It it doesn’t work. So then in that case, you know, the scary part for a homebuyer is that you’re going to potentially lose your deposit. And you write a check for $1,000, $3,000, whatever that number is, you could potentially lose that deposit.

Now, there are ways you can work with your lender and the real estate agents to fix that, but it’s a scary time when you you were promised one thing up front and then during the process becomes something completely different. So, you know, way the way that I overcome that and the way that I, you know, prevent that from happening is you see the worst case scenario from me in the beginning. I may lose customers because of that because I look more expensive, but at the end of the day, you want a good surprise, not a bad surprise. So

You know, if another recent scenario was a lender provided a customer with a loan estimate up front and it was for four point five percent down on a house and not five percent down on a house. Customer comes back to me and says, Hey Jon, you know, you’re like fifteen thousand dollars more expensive. Well, you know, first of all, their insurance quote is wrong. They, you know, they quoted or they quoted at the hundred dollars a month for insurance.

You’re probably closer to $2,800 a year insurance. So that’s a huge difference right there. They said $2,500, $25,000. I’m sorry, $2,500 a year in taxes. You’re more like $5,000 a year in taxes. And they said 4.5% down. You’re not a first-time homebuyer, so you have to put 5% down on an $800,000 house. That’s another huge difference. That point, 0.05% is a huge missing miss in down payment.

So while I look more expensive, I’m not. And long story short, I was actually $80 in lending cost more expensive after you did the whole math. Like $80 versus $15,000 is what they showed me being more expensive by. So, you know, it’s like you said, you want good at good surprises, not bad is bad surprises. So being able to walk them through that so they can see that is something that I take a lot of pride and joy in doing. It’s my job.

Issa Hanna (15:03)
Definitely. Yeah, that’s that’s a loan officer’s job is to walk you through that and to be honest about it. So if you do get a loan estimate, even if it’s from Jon, right? Make sure you ask questions. You go to shopping around and everybody make sure you ask those questions. Okay, what are you quoting me on taxes? What are you quoting me for insurance? Because a lot of times that’s how they’ll get your business, the unethical ones that Jon talks about.

Is where they’ll underquote you on things by thousands of dollars just to make your overall down payment look lower. Once you get to closing or you’re two weeks out from closing, you’re gonna get that bad surprise where you have five thousand dollars more money that you have to bring to the table. And if you don’t have it, guess what? That loan is done. And there’s nothing nothing you can do about it, and you’re out the earnest money, your earnest money deposit. So Jon thinks about that.

And make sure when he does approve you, you’re approved. You’re going to go to that finish line. You’re not going to be riding this high and then hit that demoralizing low saying, I’m not going to get my dream home. And also I’m I’m out thousands of dollars over somebody misquoting you. So make sure you check that loan estimate. Jon, that’s man, you’re giving such great advice to the people. I’m getting excited about it. So how about

Your degree in marketing, you mentioned, right? How important is marketing to a new loan officer or or a realtor trying to drum up business?

Jon Wilson (16:38)
Marketing so marketing and business is what I built my business off of. And marketing is key because in this industry, if you’re not in front of people, they don’t know you exist. I’ve gone through the ebbs and flows of you know being you know productive and thinking that stuff is gonna keep coming in and going and going, and sometimes you know it’ll go, you know, this is this is the way that you ride. So I had a good friend from high school.

Like I re I I text we text each other every birth every birthday and Christmas and stuff. We don’t see each other that often anymore. Actually, probably haven’t seen him in sixteen years, but we still text every, you know, so often. And he had bought a house. And I’m like, Well, why didn’t you call me? Like, you know, you you know me. Like, why didn’t you call me? I forgot he goes, I forgot you did mortgages. And it that goes back to

Me as a loan officer not doing a good job presenting marketing, marketing myself out there for everybody. So you know, if you you can’t slack, you know, you you you can’t it’s just if you don’t do it, someone else is going to get the phone call and you won’t. So marketing is very important in this industry because if you’re not in front of people, you’re not gonna get the phone calls. As simple as that. And it can be as simple as your, your, your parents, your, your friends. Again, this is a

He was a groomsman in my wedding, best good friend, bought a house without at least didn’t even consult me. I don’t care if you don’t use me, but didn’t even consult because they forgot I did mortgages. And that that is a stab in the heart of like I’m not doing my job right.

Issa Hanna (18:20)
Definitely. And that’s such a great answer because a lot of people get mad. Man, you know me. And that you’re saying it’s my fault. I didn’t market myself enough. So let’s say they pe the people are taking your advice, they’ve marketed themselves to their sphere and all that stuff. What advice do you have for somebody new on fostering these new relationships and then growing their network?

Jon Wilson (18:41)
Consistency is key. You know, I can say I’m marketing every day and not, and they’ll forget about you. This is another one of those subjects that I like I’m very passionate about and I can I can go on hours about this. So I I take the philosophy of, you know, one of my relationships I used to have before I transitioned to a different company was they told me I would never be a preferred lender to this but to this relationship.

I said, great. I’ll see next time and I was going there knocking like bringing you know marketing material, flyers and stuff every week, every Tuesday morning or back then it was Wednesday afternoon because that’s when they were ever all everyone was in the office. And they said, You’ll never be a lender to us. I said, Great, I’ll see you next week.

So just keep going and going. I you want to be that person. Like if you don’t show up, you want them to call you. Were you in a car accident? Are you okay?

Like you didn’t tell me you weren’t going to be here this week, even if not using you, you want that phone call from them and say, Where are you? Why didn’t you show up? I was waiting for my iced tea today. You don’t you bring iced tea every Tuesday? You know, it it’s you want to be in their face in a way that’s not aggressive, but you want to be rememberable. And it’s not always about asking them for their business. It’s asking how their dogs are, how their kids are, what they did this weekend. I never go in and say, Why haven’t you sent me a loan? That doesn’t work.

I go in and I I ask about their family, friends, weekends, whatever the case may be. I’m having those conversations because it doesn’t like I as a loan officer, I’m working, you can’t see behind me, but it’s my house. I don’t have an office technically. I don’t sh you know, I don’t have I can’t go buddy buddy with my friend next door. Hey, you want to go grab a cup of coffee right now? And you know, I’m slow right now. My real my my office staff is the real estate agent, the builder.

The attorney, everybody I’ve talked to, like those are my coworkers, not my referral sources. So, you know, that being able to be consistently in front of them in a non-aggressive way, but allowing them to build a friendship with you, just like you would sitting in an office cubicle next to someone else. You know, that’s you know, key.

Issa Hanna (20:54)
Definitely show up, work hard, show them you’re a good person, you’re there to work, and that you’re there to earn their respect. I always compare that to the movie *Rudy*. Right. Rudy started off and you could be the strongest guy, but when it when it comes to marketing, it doesn’t matter how big you are or anything. You we’re all Rudy. We all start off as Rudy. At the end of the movie, I don’t want to spoil it, just go watch it. It’s exactly what Jon is talking about.

Jon, five years down the line now, what does the future hold? What are your future plans?

Jon Wilson (21:31)
That that’s a great question. I I don’t know what tomorrow’s gonna have in plan for have in store for me. Like I said, like back to the first, like, what does my day consist of? You know, I had Cheerios this morning, I’m good to go. I don’t know what I’m gonna have for breakfast tomorrow yet. But in my dream world, being able to integRates with trans with education to help build a smarter home buying base, whether they use me or don’t use me.

I don’t I want to I want to rebuild the industry in a way that everybody’s playing in a on a on a fair field. Comparing apples to apples, not apples to oranges or apples to grapefruit, whatever analogy you want to put in there. I want homebuyers and potential homebuyers and you know current homeowners to understand that there is a way to look at things and a way to do things that

Makes my job easier and should make the home buying process better for everybody. Yeah. I mean that I so five years now being here doing what I’m doing, but hopefully not having to educate as much, if that makes sense.

Issa Hanna (22:46)
Definitely. No, definitely, definitely. Because you know, as people in the industry, sometimes you take for granted how much the general public actually doesn’t know or or how you know, the term DTI, debt to income. They don’t know what that means. So you wanna educate people so they’re walking in, when you’re talking to they they know what you’re saying. They’re not just nodding their heads and and signing the dotted line. You know, they know what they’re they’re signing thirty years of their life away for.

Jon Wilson (23:15)
One of my favorite things they one of the things I pride myself in now is finding the language to best tr translate to you know, everybody talks speak English, speak Spanish, speak Japanese, whatever language you speak, mortgage language is a it’s a whole nother language. If it I wanna be able, but how I speak to you, you may not understand just like a teacher in a classroom has to, you know, adjust to different students in the classroom and how they educate to them.

Me talking to an accountant who understands, you know, debits and credits, it’s not the same as me talking to a plumber who understands pipe, I don’t know piping or whatever or flow flow rates. To be able to explain, translate mortgage language into a language that the homebuyer can understand is something that is also time consuming, but fun for me because when it clicks for them.

Then it makes my like feels like I have accomplished something. Even though I’m not closing that loan, it makes me feel like I’ve accomplished something for for at least that day.

Issa Hanna (24:20)
Definitely. And it gives people peace of mind, you know, the consumer, the the general public when when they know what they’re getting themselves into. So just a testament to what a great loan officer you are and and why people should deal with you. And with that, if people did want to deal with you, Jon Wilson at Rate, how could they get a hold of you?

Jon Wilson (24:42)
So my cell phone is the best way, which I you guys it’s three zero two five hundred zero three six five, which is great because you know I’m available three hundred sixty-five days a year. Didn’t realize I had it when I came over, but it’s a great number. But you know, most of the time, you know, that’s the best way to get a hold of me. Emails, I read I respond to them in my head on the road, but I never actually hit send and type it into my phone. So

You it’s one of my bad habits with ADHD. And and like I I see it, I look, Bob sent me an email to you know ask about his appraisal. He should definitely order that appraisal today. And then I keep driving or I you know back on the road and drive. I never actually type my response. So the cell phone is the best way to get a hold of me anytime. It’s on me from seven. I used to be used to quote 24 hours a day. However, it’s now like seven a.m. To 10 p.m. Every day.

Monday through Sunday. And if I’m not available, it it it’ll ring and I’ll respond to you as quickly as I can.

Issa Hanna (25:47)
Definitely. And you know, that goes back to organizing chaos. Sometimes the emails will slip through, especially you’ll have it right there, and then it’ll get saved as a draft. And next thing you know, you have ten drafts in your email. So you can definitely relate to that. So make sure you guys call and text Jon because he’s a great loan officer, a lot of experience. He cares about you, and he’s going to give you the best deal, and you’re not gonna get any bad surprises with Jon.

And with that, Jon, I’d like to thank you for coming on the show. It was a pleasure picking your brain about your vast knowledge. I love your philosophy about lending and educating the general public. So definitely a great conversation, man. Thank you.

Jon Wilson (26:34)
Thank

You for having me. I appreciate it.

Issa Hanna (26:36)
Thank you. I appreciate you. And if you guys enjoyed my conversation with Jon and want to see more just like it, make sure to hit like and subscribe. I talk to people every day that can bring us different knowledge on every aspect of the real estate industry. Until next time, the Real Estate Pros are out.