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Show Summary
In this episode of the Real Estate Pros podcast, Kristen interviews Jeff Fink, a wholesale account representative at Velocity Mortgage. They discuss Jeff’s extensive experience in the lending industry, the unique challenges brokers face, and how Velocity Mortgage addresses these pain points. Jeff explains the credit criteria for various loan types, the importance of a streamlined loan process, and the current strength of the investment market. He emphasizes the flexibility and options available to borrowers, making a compelling case for working with Velocity Mortgage.
Resources and Links from this show:
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- Investor Fuel Real Estate Mastermind
- Investor Machine Real Estate Lead Generation
- Mike on Facebook
- Mike on Instagram
- Mike on LinkedIn
- Jeffrey Fink’s Website
- Jeffrey Fink on LinkedIn
- Jeffrey Fink’s Phone number: (818) 723-1638
- Jeffrey Fink’s Email: [email protected]
Listen to the Audio Version of this Episode
Investor Fuel Show Transcript:
Jeffrey L Fink (00:00)
The criteria that doesn’t change for ⁓ single family homes, mixed use, commercial, meaning apartments or warehouses, is a credit score 599 and below. We don’t care what the score is. We’ll go up to a 50 % loan to value, whether it’s a refi or a purchase. We don’t have any seasonings. They could be untitled the next day. That’s not a problem for us. We’ll do foreclosure bailouts or bankruptcy bailouts.at 50 % loan to value with no problem. Generally we’ll write those on a 30-year fix so there is no balloon but if the borrower wants to have like a two-year bridge loan instead we can do that for them.
Kristen (02:06)
Welcome back to the Real Estate Pros podcast. I’m Kristen and I’m here with Jeff Fink, who is a wholesale account rep at Velocity Mortgage. So we have a lot to talk about within the lending world. I’m excited to get into it. Thanks for being here, Jeffrey. Amazing. So how about you’ve been in this industry a very long time, ⁓ 30 years, you said. So talk to us about how you kind of got into this and what you love about it.Jeffrey L Fink (02:17)
Sure. Thanks for having me.Correct.
I got into it, I was in the finance world originally and then somebody introduced me to the mortgage industry and before you know it I was just writing mortgage loans. I was a broker for a long long time, I still am a broker but I was submitting a lot of loans through this lender and they basically brought me on board because the BMI’s would do this, you have a good relationship with a lot of lenders out there and brokers.
So I started kind of transitioning from broker to being a wholesale account rep, which benefited me because I understand what the normal broker is going through, ⁓ the pressure they’re getting from the borrowers, how they need to get things expedited. So I basically take every deal serious. I get to like my own personal client, not just a broker sending me a deal as a number. So that, that is a completely different deal because most account reps were never brokers to begin with.
Kristen (03:09)
Right.Right, and…
Jeffrey L Fink (03:29)
absolutelySo I’m out of structure stuff, you know just You send a deal in and it doesn’t really quite fit. I have a second set of eyes and sometimes I can show you how to move things around the puzzle to get a deal done.
Kristen (03:43)
Yeah, absolutely. I love how you were talking about kind of the pain points that brokers have. Can you just expand on that a little bit more and kind of how… Yeah, pin points and kind of how you work with them and you know, what makes it…Jeffrey L Fink (03:50)
You mean they’re, they’re, they’re pinpoint you said?Yeah, basically, yeah.
way I work with them, know, they can go into a portal price alone, but I always like to be in front of it. I always tell them, email me the scenario, even if you’re putting into the portal, because sometimes you’re pricing something in engine, you can not put in something incorrectly. You could put a FICO score in of 649, and then it may not price well for you because you didn’t put 650.
When it’s 650 I could get the deal I could get an exception 649 So you can’t I would say send me the scenario. I’ll tell you how to structure it, uhm and then we can get the deal done because the other day you want to get the deal done because Every client you get is just so valuable and you have to get back to them quickly and more importantly if you promise something You got to come through with it So if I tell you we could do something we could do it
The only thing that would possibly cause it to not close alone is if the borrower did not disclose something that showed up on whether it be title or the credit report or mortgage history, things like that. If they didn’t disclose stuff, then yes, I mean, stuff can get you know messed up. But if we have all the information, it’s not gonna get messed up.
Kristen (06:10)
Right? Absolutely. Talk more about kind of that credit criteria and what you guys are looking for.Jeffrey L Fink (06:16)
Yeah,so the credit criteria, this is where we separate from everybody. ⁓ First, we’re direct lender, we’re not shopping it. ⁓ When we price a loan, I like to call us soft hard money a little bit because our rates are less. So our interest rates can range from 8.5 on single family homes to 10, our mixed use in commercial properties, you know, they could be 8.5 up to 12 depending on the loan to value and the credit scores, but
The criteria that doesn’t change for ⁓ single family homes, mixed use, commercial, meaning apartments or warehouses, is a credit score 599 and below. We don’t care what the score is. We’ll go up to a 50 % loan to value, whether it’s a refi or a purchase. We don’t have any seasonings. They could be untitled the next day. That’s not a problem for us. We’ll do foreclosure bailouts or bankruptcy bailouts.
at 50 % loan to value with no problem. Generally we’ll write those on a 30-year fix so there is no balloon but if the borrower wants to have like a two-year bridge loan instead we can do that for them.
Credit scores of 600 to 649 we can go as high as 70 % loan to value purchase or refinance and credit scores of 615 above we can go up to as high as 75%.
depending on the loan amount. But the real good stuff too on commercial, like we’ve been doing a lot of warehouses lately, warehouse space. Just did one for three million. We just closed, value on the property was five seven. No bank statements were needed. Just verified business license.
And obviously the appraisal and we do an environmental check on the property. Obviously make sure there’s no chemicals and so forth, right, on the property. But that’s the beauty. And if you have, we don’t care about tax returns. that’s when you get into owner user, mixed use of commercial properties, if it’s owner user and it’s a loan amount below 700,000, we don’t need anything. Over 700,000, all we ask for is a profit and loss statement.
So we have our stuff to just not complicate. We’ve, we’ve thinned out all the documentation. And that’s. it
Kristen (08:32)
And how does that,I mean, talk kind of more about how that’s even beneficial, like for you guys, I guess, know, thinning out that criteria, you still kind of get this, you’re able to work with customers and there’s nothing holding you guys back. So you know, why do other people have those barriers in place, do you think?
Jeffrey L Fink (08:51)
You know it depends on the lender they’re using. You know we fund our own loans. We securitize our own stuff. We’re publicly traded. So we don’t have to worry about brokering it out or going to get an exception because we are the bank. So that’s the difference. If you try to get a commercial loan at a bank just as an example, they’re going to want three years tax returns. And you know both know sadly most business owners show very little profit.at the end of the day. So we’ll look at the building, we’ll look at the business, and when we do our appraisal, all that comes into contention. So even if it’s an order user building, our appraisal will still involve a rental survey because if we had to take the building back for some reason, we have to know how much we could rent it for. But everything is based on loan to value and FICO scores. When get into loan amounts above two million,
Kristen (09:36)
Right.Jeffrey L Fink (10:19)
We limit our loan to values to 70%. But always, we always have exceptions. because everything’s got an exception to it. If someone’s had a great mortgage history on their primary residence, but maybe they’re 60 days late on their warehouse loan, we could still get that done. A perfect example, Lilly just closed a warehouse loan for 3.1 million.the guy was currently seven weeks behind on his current million something loan payment. Okay, we still closed the loan. We got a letter of explanation, but there’s not a bank in America that would close that loan and give you two million cash out when you’re seven weeks behind.
Right, but you go a little more in depth in the deal and we found out what the reason was and we were okay with the reason. Yeah.
Kristen (11:05)
Well, I mean, that givespeople a lot of options. think that definitely in this world, a lot of people kind of, they say the no to themselves before they hear the no and they kind of hold themselves back from maybe getting a good deal.
Jeffrey L Fink (11:19)
Yeah,I mean the beauty of our product is that you don’t have to have a lender’s license or broker’s license in 90 % of the states in this country. The only states that you have to have a broker’s license to fund investment loans is California, Utah, Arizona, Nevada, and Oregon, and Idaho. That’s it, the rest of the country is wide open. So you’ve got license.
loan officers out there all over the country that may be submitting loans through their broker, whether it be through us or someone else, where they can sign up directly with us. They don’t have to split anything. And we don’t charge any points. You charge what you want to charge. We’ll allow you to charge up to five points in origination fees on, on a loan.
Kristen (12:02)
Yeah.Yeah, absolutely. mean, there’s a huge benefit there. And how do you find brokers that you like working with? kind of how do you go about making…
Jeffrey L Fink (12:17)
⁓ For the most part,I got a referral base where one broker will refer me as a friend. I do get some, I’ll run some kind of spotty ads here and there on Facebook. So I’ll get some calls here and there. I’ll go into LinkedIn as well. I’ll get some stuff there. But that’s the most part. But the amount of loan officers out there that one, don’t know about us, or two, are channeling loans through their broker when they go.
independent with us, it’s pretty much untouched. But I think at end of the it’s our FICO scores. Our FICO score and our loan equity. But our best product is that, you know, if you got a 605 score, credit score, and it’s a single family home and you need a 65 % loan to value, I can get that done.
Kristen (12:47)
Yeah.Wow.
Jeffrey L Fink (13:05)
Yeah, and it’s no income, you know, it’s, don’t even care about the rental income. If the property’s leased out, we definitely get a copy of the lease to document the file. If it’s vacant, then we just get a letter of what is your plan with the property? Is your plan to Airbnb it? Is your plan to put it off release? Just so we understand what your plan is, but we don’t worry about it being leased out.Kristen (13:31)
Yeah, and what is kind of the timing with, you know, these loans that you’re…Jeffrey L Fink (13:36)
Start to finish if it’s a one to four unit property Start to finish if we get everything in on time really should not take more than 21 days I’ve gotten them done in 14 days on commercial properties That’d be mixed use warehouses Apartments. I mean those tend to take a little bit longer Those could take up to I get them done in 30 days, but Sometimes you got tenants in a propertyThey’re not allowing someone in. So I always say those deals tend to take six weeks. I try to be as transparent as possible to set expectations so nobody’s upset.
But can you get them done in three weeks or four weeks? Yes, that, that can happen. So it’s just about cooperation from everybody.
Kristen (15:00)
Yeah, and what are some of the things that maybe you see from people that delay the process? I’m sure you see mistakes over and over.Jeffrey L Fink (15:07)
Sure, absolutely. Well, the first thing we do is the minute a file is submitted, we then from there, we’ll issue out a link for them to pay for the appraisal. Okay, so they get that done right away. From there, I have the brokers send them out the insurance request so we get the right lost pay information and right coverages and also make sure they get their title ordered. Too many times brokers…wait too long to get that stuff. So now the appraisal comes back, right? And they haven’t got the, they don’t have the title yet. They don’t have the, they don’t have the insurance yet and it holds things up. If you get into certain areas, example, I do a lot of loans in Florida on the coast. Insurance is tough everywhere now. So you really have to be on top of it, especially if there’s flood, you need to get wind insurance, hurricanes, all kinds of stuff. So the minute that appraisal is paid for,
The minute it is paid for, I send out two forms with exactly what’s needed for both. And if you get those things, if those come in and the application’s in, everything else just flies through the system. It is, But the TOTA report’s the most important because it always seems to be something that shows up on, on the preliminary TOTA report that may be correct or incorrect or old, and we need to address it you know quickly so we’re not hung up.
Kristen (16:24)
Yeah, absolutely. And you’ve been in this business for so long, 30 years. I’m sure you’ve seen a lot of up and down waves in the investment side of things. What’s it looking like now? Is the investment market pretty strong right now?Jeffrey L Fink (16:38)
It’spretty strong. Yeah, your investment market is absolutely strong and your biggest reason is the banks themselves have tightened up. Okay, because they’re sitting on supposedly a bunch of commercial losses. So when they give a loan on a commercial property, whether it be a warehouse or a single family home or whatever, they want to see full tax returns. They want to see full documentation. They want to see generally, you know, 12 months reserves where we don’t. So that
That right there separates us completely. But most people that own investment properties, for the most part, they really tend to be self-employed, which means generally they’re not gonna show enough income. There’s loans out there, the DSCR loans, which is based on the rental income, as an example. I find the biggest problem on DSCR loans is they’ll go as high as, say, an 80 % loan to value.
Kristen (17:17)
Bye.Jeffrey L Fink (17:34)
But the interest rate and based on the payment, it doesn’t make sense. In other words, they want to borrow 80, but because it’s not aligning up, maybe they get cut back to 60. So we kind of get a lot of DSCR fallout because we don’t care about the rental income.So that really makes a big difference with us. Our rates are a little bit higher than that, but that is an odd issue for us, plus the credit scores will go low credit scores.
Kristen (18:03)
Yeah, absolutely. I mean, you guys give such good options for people and I mean, you get the deals done very quickly as well. ⁓ think, yeah.Jeffrey L Fink (18:05)
Yeah.Well, yeah, like I get,
we’ll get a lot of hard money bailouts. So people that took out one year hard money loans through private lenders, right? I mean, there’s so many out there that I can’t begin to tell you. And one year rolls around, those have balloon notes that are due. And most of the hard money lenders, what they want to do is foreclose because they get the property and they get the penalties associated with it. Most of those penalties are 20 % of the principal balance. But 99 % of those loans could have funneled through us.
to begin with on 30-year fixed rates with no balloons at better rates and less cost.
if they would want this option to begin with.
Kristen (18:48)
Yeah, absolutely. I mean, it seems like a no-brainer to work with you guys. I think you’ve given a really good… Yeah, exactly. And that’s what we’re doing here. Kind of on that note, tell everybody how to find you and how to work with you and kind of the types of people that you love working with.Jeffrey L Fink (18:54)
You just have to know about us.Yeah, I know the best way to get a of me, honestly, just you know call me direct. 818-723-1638 or send me an email at jfink @ velocitymortgage.com.
Kristen (19:20)
Amazing. Well, thanks so much for being here, Jeff. And thank you everybody for listening. Hope you learned a lot and maybe got some inspiration to maybe restructure your business a little bit and reach out to Jeff for sure. And we will see you back next time. Bye.Jeffrey L Fink (19:23)
Thanks, Kristen, appreciate you.Alright,
thanks Kristen.
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