Why Mortgage Preapproval Isn’t Enough to Win a Home in Today’s Competitive Market

Sol Skolnick (00:00)
And one of the things that I am out there with all the time is, you know, people always say you need a prequalification or preapproval. And I’m saying, that’s great. Take a look at the line on both of those documents, which says this is not a commitment to lend. And that’s an important.

So that means when you go out there, if you’re competing against cash buyers, you’re ready at a disadvantage. And again, you’re not even 100 % guaranteed that you’re going to be approved for what you’re doing.

Q Edmonds (02:02)
Hello, everyone. Welcome to the Real Estate Pros podcast. I am your host Q Edmonds, and I am excited to be here today. I am excited about my guest. And listen, he loves to educate people. When people want to go out and get a home and look to get a home, he’s going to make sure that they know and are well educated before they begin that journey. And so I’m super excited. I’m excited. This gentleman comes with a wealth of knowledge. So I’m excited for us to look from his lens, to learn from his experience.

And so I want to introduce you all to Mr. Sol Skolnick. Mr. Skolnick, how did I do with that last name,

Sol Skolnick (02:39)
You did very well. Thank you, Quentin.

Q Edmonds (02:41)
Absolutely. How are you doing today, my friend? man, doing good, doing good. I am happy to do this episode with you. I’m ready just to sit down and just literally learn from what it is that you do. And so I’m excited, man. So, Mr. Sol I’m the type. I like to dive right in. Right. So I would love for you to tell the people what’s your main focus these days.

Sol Skolnick (02:44)
I’m doing well on yourself.

Q Edmonds (03:05)
If you don’t mind, give us a little bit of an origin story, kind of how you got into the space that you’re in, and then tell us what part of the world you’re in. People love to know where you are geographically. So what you’re up to, the origin story, and where you are. Mr. Skolnick you have the floor.

Sol Skolnick (03:14)
Okay.

Okay.

All right. So I’ll give it to you in some order. My origin story is I was in book publishing for a very long time. I ran in prints at places like Simon & Schuster and Random House. And then when Kindle came out, my wife was also in the same business. We looked at each other and said, we don’t know where this business is going and what it’s going to turn into. Maybe one of us should do something else.

And so I said, I’m going to tell you in the next tomorrow morning what I’m going to do, and it’s not going to be book publishing. So I came down to breakfast and I said, I’m going to become a mortgage banker, to which my wife said, excuse me. And my kid said, say what? And I said, it’s real simple. We’ve been living in the New York area forever. We were both born there. We were in Westchester County, which is just above the city at that point, probably for 15 years. And I said, there are two things that are never going away here. That’s money and real estate.

Q Edmonds (04:09)
Yeah.

Sol Skolnick (04:10)
So I said, I’m going to find a way to make a living doing that. ⁓ At the time, of course, in 2006, getting a loan was ⁓ easier than it became after 2008. ⁓ But the point was, you know, people moved up into the suburbs on a regular basis, or people continue to live in the city and went from renting to buying. So being in the New York metro area, it was very clear that real estate was a good way to.

create a profession.

Q Edmonds (04:43)
Yeah, yeah,

Sol Skolnick (05:34)
So, all right, in terms of what I do and where I am. So I’m in Westchester County, which is White Plains, Battle of White Plains, beginning of the American Revolution, just north of New York City by train about 35, 40 minutes, depending on where you are, or you could just go down the West Side Highway, not a big deal. So Westchester County, I also work at a Fairfield County.

in Connecticut. Those are areas where people typically move to when they’ve decided that they are growing a family, need a different kind of education that might be available in the city schools. And so they move up to the suburbs to these little villages and towns, most of whom, you know, operate their own school districts, as well as offering property and homes in a different way than if you’re living on top of somebody on, you know, West End Avenue or East End Avenue.

Q Edmonds (06:28)
Love it, Mr. Sol. Thank you, sir. So as you was talking, man, I was actively listening, writing some things down, because I like to give a brief summary of what I believe I heard, because I like to make a statement and ask you a question. And so you started out in the book publishing world, you and your wife in the same kind of, same world. And so when Kendall came out, he was like, hey, listen, babe, we got to have a conversation, got to do something different. Came down to breakfast and like, listen, I’m going to the mortgage business.

This is going be around. I know this is going to be sustainable. So that’s going to the mortgage business. And so you said 2006, of course, getting a loan was a little bit easier before the crisis. Now you in that Westchester County area, but also do business in the Fairfax business. I mean, Fairfax, you do business in that area as well, right? OK. So I love it. Yeah, yeah, I love it. And so I always like to do this summary.

Sol Skolnick (07:14)
Fairfield. Right. Yeah. End of the city.

Q Edmonds (07:21)
Cause Mr. Sol, I have a statement. always say destiny has no wasted moments, right? Meaning like as we go through the journey of life, we’re building momentum and we’re borrowing from each stage, each iteration of our life. And we borrow from the lessons, you know, we borrow from the failures, from the success. We borrow from it all. And it kind of rounds us out to the people that we are today. So I would love to know Mr. Sol.

on the journey, I you came down, had that conversation with your wife from the book publishing arena to the journey to where you are now. What has life, what has the journey, what has the moments taught you about yourself? Has they taught you discipline, resilience? Yes, sir.

Sol Skolnick (07:57)
Well,

yeah, well, the good thing that happened was unfortunately the crash was not a good thing. But what it did is it really changed this business. All of a sudden, people had to have an education. There were no NMLS numbers prior to 2008. And so I was amongst the first people, amongst thousands of others, obviously, to get, you know, to have to get the education, to get the NMLS, you know, to get licensed in a way that had not been required.

So it meant that the level of professionalism that was required of me was more than the people who had done it before, even more than I had to do it before. That’s been very helpful. So I learned a lot very quickly and learned it pretty thoroughly. And so what I’ve done over time is hope that I’m educating. And so my book and the other things I do, I always call myself Sol Skolnick, professor, home loan. I want people to know that they’re going to have questions and my main ⁓

reason for being in this business is to answer those questions and if I’ve answered them well, you’re going to say, okay, lend me some money.

Q Edmonds (08:58)
Yeah, yeah, yeah, yeah. I love it, I love it. So let me ask you this, was it an easy transition? Because I know adversity pops up in everything that we do, right? In life, just life we have to face adversity. So has, the transition, has there been any adversity that you faced while you was going from one to the next?

Sol Skolnick (09:17)
Well, yeah, I would say not adversity. I mean, it was a matter of learning what I needed to do and paying attention. And yes, we all went through the same adversities as the economy, you know, has bucked up and down and gone into all kinds of, you know, different colors. So that’s the problem we will share. Fortunately, I’ve been working for lenders who have tried to adjust as time goes on. The one I’m currently working for is 100 % Mortgage Bank.

So that means that we have to do what we do well because we don’t have credit cards, we don’t have checking in savings accounts. All we do is lend you money for residential property. ⁓ So we’ve got to both do it well, but also have diverse number of products so that people who have different requirements can be satisfied.

Q Edmonds (10:05)
Yeah,

yeah. Love it. Love it. Let me ask you this, Mr. Sol, what’s next for you? Like, what’s next, you know, business-wise? Are you looking to solve or, you know, do you have goals you’re looking to solve or scale anything? Like, what’s next for you, sir?

Sol Skolnick (10:52)
What’s really next for me is this podcasting. ⁓ I’ve been putting myself out there because I want people to have conversations and understand how this works. I mean, I’m on social media, as is almost everybody else on the planet at the moment. And then looking to separate myself from some of the people I compete with, I said, OK, if I have something to talk about that people want to hear,

Podcasting is the way to do it. So I’ve been aggressively asking people who like yourself or having podcasts in the mortgage and real estate area, can we have a conversation? Can I let people know that there are things that they should do?

And one of the things that I am out there with all the time is, you know, people always say you need a prequalification or preapproval. And I’m saying, that’s great. Take a look at the line on both of those documents, which says this is not a commitment to lend. And that’s an important.

So that means when you go out there, if you’re competing against cash buyers, you’re ready at a disadvantage. And again, you’re not even 100 % guaranteed that you’re going to be approved for what you’re doing.

So where I work and a lot of the individual lenders have what’s called a TBD or to be determined commitment letter. The to be determined is the property. But we will take

the pre-approval information and then send it to an underwriter and I will hand you a commitment to lend money pending your finding the actual property. And so I’m crusading, if you will, for people to understand that that’s what you need, especially in the competitive markets where other people are showing up with cash or people have additional dollars, you know, that they can throw at their offers. And so,

Having a TBD commitment, a to be determined commitment, puts you in the place where it’s cash because all this has to be done after that is to find the property and for the property you appraise or to make up the money if it doesn’t appraise. But that’s what I’ve been doing very aggressively now. In addition to trying to get my book in the hands of people, I give it away. I don’t charge for it. There’s an e-version as well as a physical version.

I want people, know, it’s written for people who are not in this business to be able to understand what is it going to feel like? What questions should they ask? What kind of team do they need to build to make a successful purchase in a very competitive way?

Q Edmonds (13:18)
Yeah. I’m so glad you decided to write a book. I’m so glad that you’re putting yourself out here with podcasting. mean, you’re from the book world being in publishing. So, you know, stories matter. Like people pick up and stories resonate. And I tell people all the time, this is why podcasting is one of the tools that I use because I really feel like one of the things that I, one of my purposes in life is to create space.

for people to recognize and tell their story, right? The creator speaks, I think everybody, I believe everybody has a story to tell. Before the late great Kobe Bryant passed away, he was on a podcast and the podcast asked him, what is it that you want to do that you have not yet done? And Kobe said, tell the perfect story.

He says, nothing in this world moves without story. And so I’m so glad that you’re writing a book, getting the story out, because I believe like everybody has a narrative to tell. And even in this business world, we pick up on each other’s narratives and we learn from each other and we plant seeds so that people can take those seeds and plant them in their business, in their life. And then hopefully that helps them out. Literally could course correct what they’re doing. And so I’m so happy that you’re doing this, because I know you have a powerful narrative to share with people.

based on your experience, your life experience, and I’m glad that you’re here. So I’m going to love asking you this question. Everybody that comes on, I ask them this question just to get their unique perspective. So Mr. Sol, when you hear the word relationship, what comes to mind to you, the word relationship?

Sol Skolnick (14:54)
conversation leading to understanding what the other person needs.

Q Edmonds (15:39)
Whoa, succinct conversations leading to what the other person needs. ⁓ That’s so good. You know, I think communication is so so important and I always say communication has this 55 38 7 rule 55 % is actually The body language that we use when we communicate 38 % is our tone 7 % is actually the words that we say

Sol Skolnick (15:48)
Thank

Q Edmonds (16:07)
I’m so glad, man, that you talked about communication. think without communication relationship, would a relationship be, right? Without communication. So I appreciate you bringing it up for sure. Let me ask you this, Mr. Sol, is there any topic that I have not brought up that you would like to talk about? Is there any other words of, let’s say, inspiration, education, and motivation? Like, I don’t know. You may have came in with.

a message on your mind that you want to make sure our viewers hear. And if that’s the case, I kind of want to open up the floor so you can land that message.

Sol Skolnick (16:39)
Yeah, it’s very simple. ⁓ Not everybody needs to own a home in order to live in. should, you need to make that determination for yourself.

⁓ And then if you decide that that’s something you want to do, understand that it’s going to be a big expenditure. But if you’re living in it, it’s your shelter, not necessarily an investment. Yes, I understand that over time, homes can increase in value, but you don’t buy a home to live in in order to make money from it. You buy it in order to live it. It also is expensive and time consuming in order to maintain it.

So I think that’s an important thing. And then once people determine that that’s something that they want to do, for whatever reason it makes them comfortable, then we need to help them as real estate professionals ⁓ get that done in a way that is efficient and comfortable and sustainable more than anything else.

Because you can control, once you’ve got a loan, you know what your interest rate’s going to be, you know what the cost’s to be, you don’t know what’s going to happen to taxes, you don’t know what’s going to happen to insurance, you don’t know when the boiler’s going to break. So getting that information upfront and understanding that that’s a very important part of ownership is one of the messages I like to hand to people.

Q Edmonds (17:57)
I love it. Mr. Sol, someone gets your book. What can they expect? What kind of information can they expect for you to give them?

Sol Skolnick (18:03)
It is a basic beginning to end. This is what you need to know. This is how to build a team. This is what loans look like. This is what different kind of loans are available. These are the things you should not do when you’re applying for a mortgage. I tell people straight out, even if you can afford it, please don’t buy the furniture. Don’t buy a new car. Not because you can’t afford to, but once you’ve had your loan underwritten and once you have a commitment for the purchase,

If you change anything, the underwriter’s got to go back and do it all over again. ⁓ So please don’t do that. Just hold on to it. You want to go buy furniture and an automobile the day after? Go ahead. Wait till you’re out of the closing table.

So there’s that kind of information. So there’s 10 things you shouldn’t do, but mostly things that you should do in building a team with a real estate agent and an attorney and a loan officer who help you through it because that’s what they do professionally. You may do anything else in the world professionally and do it really well, but the information that you need on a daily basis is going to come from there. And also at the end of the book is an extensive glossary because there are terms that are not normal terms for people in everyday life. So when I say DTI,

Somebody should look at me and go and say what? Yes, it’s called debt to income. You need to know that. Please don’t use acronyms. know, ⁓ PITI, principal interest taxes and insurance. What does that mean? Well, it doesn’t mean anything until you get there. So that’s what the glossary is there. But also, very clearly, please, you know, don’t use the acronyms. Use the language, except obviously, if you’re in the industry. But for people looking to make the acquisition, keep it simple, move it forward.

and understand that it’s not permanent. when people, people will say, I need a 30 year fixed mortgage. Really? Why do need a 30 year fixed mortgage? How long does the average mortgage last? Well, before the pandemic, five to seven years after seven to 12 years. Why? People refinance if rates change, they refinance if they need cash out, they move, all kinds of other things.

So look at a 30-year note and then understand there are different things available, five-year, seven-year, 10-year fixed. Again, an adjustable rate mortgage is not going to put you in outer space. There’s a lot of fear from 2006 when people didn’t, you know, there was a different kind of mortgage available. So people believed that it could go, you know, put them out of control. It can’t. Right now,

There’s a bottom and a top to each one of those loans in terms of the rate. It’s very clearly put in the note. It might work best for you. Yes, maybe you want 30-year term, but you don’t necessarily want it to be fixed for that point. And that’s something that I I need people to know right away because, you know, again, they’re coming in off the street because that’s what they’ve heard about. That’s what a lot of lenders advertise, but not useful for most people if you think of how economics work.

Q Edmonds (20:54)
Yeah. Mr. Sol man, thank you, sir. Thank you, man. You’ve given us so much really good information. I’m so glad you highlighted some of the things you’re to find in the book. So let’s put it out there. If someone wanted to reach out to you, connect with you, collaborate with you, learn more about what you’re doing, how can they get in contact with you,

Sol Skolnick (21:13)
Very simple. can text or call me at 914-380-0600. I couldn’t make the number any simpler. 914-380-0600. Text me or phone me if you want the book, if you want to just chat, whatever it is you want to know about this part of the conversation. I will go from there.

Q Edmonds (21:35)
Well, listen, sir, let me say three things to you sincerely. First, thank you for your time, right? You could have been doing anything with your time. And you know, we had a little mix up earlier. So definitely, thank you for your time. Thank you for being here. I appreciate you. Secondly, again, thank you for your story. Thank you for your gift of authenticity, your gift of integrity. Like I said before, I really believe our stories, our narratives, the things we talk about, they have a way of planting seeds in people.

Sol Skolnick (21:44)
Michael.

You’re very welcome. Absolutely.

Q Edmonds (22:05)
We may not see the growth, but seed is there and that thing can grow at any given time, two years from now, five years from now. So definitely thank you for coming and planting seeds that can literally course correct somebody’s life. And lastly, Mr. Sol, thank you for your mindset. Thank you for the way you think and bringing that mindset to this platform. I greatly appreciate you coming on today,

Sol Skolnick (22:26)
Thank you, Quinn. I appreciate the opportunity. I appreciate what you do for the folks that listen to you.

Q Edmonds (22:31)
Absolutely. So listen, y’all heard Mr. Sol. His information is in the show notes. Get in contact with him, get the book. But definitely make sure you’re subscribed here, because I promise you, we’re going to continue to bring up amazing people, just like Mr. Sol. So sir, I say thank you again. And everyone else, have a fantastic day.