People don’t understand how knowing the difference between pre-qualification and pre-approval can make a huge difference in an offer being accepted, and how the right choice can make them a stronger buyer. It’s extremely important! Luckily, my friend Jay Vorhees at JVM Lending broke it down for us:
Panicked Borrower on Verge of Losing Deposit
We had a borrower in contract come to us a few weeks ago in panic mode. The reason? He was on the verge of losing his earnest money deposit b/c his loan had just blown up at America’s largest mortgage lender.
The loan officer had only done a “pre-qualification” and had missed a major issue with the borrower’s commision income. We were able to salvage the deal and still close on time, but the risk to the borrower was enormous.
Pre-Qualification vs. Pre-Approval
Most lenders only “pre-qualify” borrowers. Pre-qualifications consist only of a perfunctory glance at a credit report and a few income documents. Most lenders do not do full pre-approvals b/c they require so much more work.
We do full pre-approvals b/c they are absolutely necessary. Full pre-approvals (1) allow our borrowers to make non-contingent offers; (2) ensure there are no major issues missed; and (3) allow us to close in 14 days b/c we do all the work on the front end.
In other words, full pre-approvals make our clients’ offers far more competitive, and they eliminate stress for everyone – buyers, sellers, Realtors, escrow and us :).
Full pre-approvals can take several hours, requiring us to review income, asset, employment and credit documents with a fine-toothed comb. But experience has shown that they are well worth the effort.
Issues that can be missed with only a “pre-qualification” include the following:
- missed 2106 expenses;
- unexplained and unusable deposits;
- side businesses with losses;
- K1 and partnership losses;
- spousal and child support obligations;
- lack of employment seasoning;
- lack of bonus seasoning;
- lack of commission seasoning;
- debts not on credit reports
A major source of our business includes transactions that blow up at other lenders b/c the loan officers only did pre-qualifications. Realtors come to us b/c they know we can make the deals work and also b/c we can usually still close within the remaining contract time.
We’re adding a new blog to the Saturday cycle, along with Art Town, Road Trips and Inspiration Saturday. Behold, our first version of Event Round-Up! Here, we’ll give you five of the best events around the Bay Area each month for the upcoming few weeks. If you go to any of them, let us know how you like the experience!
Cherry Blossom Festival (San Francisco)
The annual San Francisco Cherry Blossom Festival in Japantown in San Francisco is already in full swing, but the biggest event – the Grand Parade on April 22 – is still to come tomorrow. It starts at Civic Center at 1 p.m. and ends in Japantown. It’s truly a can’t-miss event. And Kristi Yamaguchi is the Grand Marshal!
Memories That Make Us (Redwood City)
Through May 6, The Main Gallery in Redwood City is hosting “Memories That Make Us.” This art show is based on memories, which shape who we are in so many ways. The featured artists will touch on both the transient, fleeting moments of their lives and on the archetypes that permeate our culture. Check it out!
Lyrid Meteor Shower (Everywhere)
Did you know that the Walnut Creek Historical Society leads a 90-minute guided walking tour downtown every 2nd Saturday from March through October? Now you know! It reveals early life in Walnut Creek and hidden parts of our town’s history. Tours are free and depart at 9:30 a.m. from the fountain at Liberty Bell Plaza (Broadway & Mt. Diablo). The next one is scheduled for May 12.
Don’t get me wrong – the right house for you won’t just magically appear out of thin air! People like me do a lot of work to find you your dream home and get it all properly situated. But there is a lesson in real estate that I believe is valuable: The universe always provides the right house in the end.
You can always look back with regrets, but there are reasons for everything. Even reasons for why getting your dream house took so long or why you didn’t get the first house you loved. The right one always comes along! Check out this graphic from the California Association of Realtors.
As you can see above, most homeowners didn’t find their home for at least 3 months. Whether it was price, location, aesthetics and amenities, or simply just being outbid, it is very common to not get the first house you offer.
That’s why you have me! I’ll be the one to help you attain your dream home by walking you through the process, preaching how important patience is, and making sure the whole, stressful process runs smoothly. In the end, the universe always brings you the right home!
Recently I have had some car problems. I have been wanting another SUV that I can take up to the mountains, put my skis and dog in, and also looks nice for clients. So, last year I decided it was time to sell my Mini Cooper. But, I kept getting the “check engine” light on and occasionally it would overheat. I needed to get it fixed before I sold it and that became a drawn-out process. Luckily, I have a great mechanic who has bent over backward to help me stay on the road.
CK Auto Repair in Martinez has taken great care of me and my cars over past few years after a friend recommended them after the BMW dealership cost me $800 for an oil change, check-up and air in my tires. Highway robbery! That coincided with a poker tournament I was playing in and a couple of the guys were raving about their mechanic and how he is the only one they want fixing their classic cars. Lo and behold, it was Danny at CK Auto.
After much soul-searching and replacing of parts when the engine light came on, we discovered that my Mini needed a walnut flush. That is where it gets rid of the carbon build-up. I bought it pre-owned and had always put in premium gas, but I’m not sure what the previous owner did.
I feel Danny was always fair; I was in there a lot and got to know Danny and his son Jessie, along with the rest of the crew as they were searching for a solution. He even would occasionally lend me a car so I could still work without having to rent one every couple of weeks. If you need any kind of help with one of your cars in the East Bay, I can’t recommend CK Auto Repair highly enough. Say my name and they’ll take good care of you! And, if you are in the market for a Mini Cooper (2009), give me a call. It has a lot of new parts and is running sweet again!
If you’ve ever hopped on BART in downtown Walnut Creek, you’ve probably seen the towering, 10-story office buildings just across the street from the North parking lot (if the train was headed towards the Pleasant Hill station). It has recently gotten a makeover, including state-of-the-art conference facilities, residential units and an outdoor area with bocce ball courts.
Also part of the makeover is a brilliant art installation, which paints a beautiful picture of Mt. Diablo across multiple fans against a wall. I call them “fans,” though I’m not sure exactly what the structure is, what kinds of materials were used, or who created it! Information is sparse.
What I do know, though, is this is an amazing upgrade to a space that was very 1970s outdated. I’m excited to see what other changes they will add to the building to spruce up the Walnut Creek BART area. It seems like good timing, with all the changes going on around and in the Bart area that destined to become a little village. Just on Riviera the back road to WC Bart and where my office is located, are 3 new condo complexes being built (a future blog), not to mention the large apartment complex across from Bart on Ygnacio.
If you haven’t been to the De Young Museum in San Francisco, I’d highly recommend visiting, no matter the season or featured exhibit. But every year in March, they have a showcase called Bouquets to Art, which is just as awesome as it sounds.
I became a member of the De Young, so it was free for me – kinda – the bonus is I can take a friend for free and also have free access to the Legion of Honor. I loved this exhibit; it was only the second time I have been, the first was in the old De Young building. It’s a really cool event in its 33rd year. I even know one of this year’s florists, Valarie Ow, from J Miller in Oakland on Piedmont. She is pictured above explaining how her piece (with the little Nemo fish!) was designed. The concept for this fund raiser is the artist gets to pick a piece of art to design a flower arrangement that enhances or ties to the art. Valerie is shown here explaining the work that went into her beautiful piece and how in the week time she had to refresh a few flowers because the lights can get so hot. In addition if there is any water leakage, the museum will have your piece removed…so much to think about.
You can see more information about the events and exhibit at their website. For non-members, prices ranged from about $19-28. They have an opening gala, and even a raffle. They attract florists from as far away as Tokyo for this event!
Check out my slideshow of pictures below to get an idea of what you could see. Mark it down for March 2019!
Okay, now I’m really stretching this whole Road Trips theme. You could, hypothetically, drive all the way to Canada from the Bay Area. It would take a solid 16 hours and would be a pretty nice drive through Portland, Seattle and Vancouver. But, I’d recommend flying.
I recently took a 2 1/2-day trip to Whistler. I left at 4 pm on Saturday afternoon and got to Whistler at 10 pm. I skied Sunday and Monday and flew back to the bay area at 6 am on Tuesday. I was back at work by noon! With the tail end of the skiing season approaching, Whistler – which always has great snow – recently got dumped on much like Tahoe. I met a couple of friends up there and had amazing snow to ski. It was a great trip.
I had a room at the Westin on the hill on the Blackcomb side. The Whistler-Blackcomb mountain resort is also massive, it has a glacier and the longest peak-to-peak tram in the world. There is also lost of expert skiing available. I wonder if the weather is a little different because the resort is so close to the ocean, but the clouds would come in and out. At one point I felt like I was skiing in soup, could not see in front of me and we just happened to be in the Whistler Bowl (a black diamond run) at the end of the day.
And if you aren’t feeling the snow vibe, but just want to explore the area, Whistler is a really cool place itself. The village has some great restaurants; we ate at 21 Steps, which serves great comfort food and a good selection of fish, pork and meat. I would also explore the rest of the area if you have the time. Just outside the Whistler area, you can trek back to Vancouver and explore one of the underrated cities of the Pacific Northwest.
Next year: Revelstoke and Heli-skiing!
VA and FHA loans are both backed or insured by the Federal Government, so realtors often confuse the guidelines between the two types of loans. There are a lot of differences, however, and my friend Jay Vorhees at JVM Lending has the scoop below:
We’ll just let this blog, by JVM’s Appraisal Manager, do the talking. I, Kristin added a few thoughts in brackets afterwards.
The VA loan forces people to use “VA approved appraisers,” which they assign. That often makes the quality worse. The FHA allows us to pick appraisers from whomever we want.
Property Condition: Different
The VA requires clear Section I termite reports, and clear Section II if the items are health and safety risks. FHA allows for “as is” transactions, and does not require a clear Section I. (There have been some recent changes regarding this, but not every lender is aware of them)
Closing Periods: Different
For VA loans, you need 21 days to close them because appraisal turn times are slower, and it’s generally just a more cumbersome process. For FHA, we can close the loans in about 14 days. (Note these are amazing turn times, most lenders need 30 days or more)
Both types of loans have lower rates than your typical conventional loans. Lower rates are a major advantage for both.
Mortgage Insurance: Different
VA has no mortgage insurance, which is one of the reasons this type of financing is such a great opportunity for veterans. The FHA, on the other hand, has a mortgage insurance of 0.85 percent for most loans, with less than 5 percent down.
Up-Front Fees: Similar
The VA has a “funding fee” of 2.15 percent with 0 percent down that decreases with larger down payments. The FHA has an “up-front mortgage insurance premium” of 1.75 percent.
Down Payment: Different
The VA loan allows for 100 percent financing (0 percent down), whereas the FHA requires a minimum of 3.5 percent down.
(Final note: most condo complexes are not FHA approved as they have not gone through the approval process which has to be updated periodically, I have not found that issue for the most part with VA because usually the complexes get VA approved at the time of building and it stays with the property)
We’ve talked about Pinky’s, we’ve talked about Pizza My Heart, and most recently, we talked about Pan Coast Pizza. But I wouldn’t want to leave out one of the best (if not THE best) pizza places in Walnut Creek when discussing great local food: Extreme Pizza might top them all!
The first thing you’ll notice about Extreme is it does all the little things right. They are open until the bars nearby close (smart move!), make good use of the physical restaurant (and decorate it in an interesting, attractive way), and seem to always have good customer service.
Then, there’s the pizza itself. Not only is the pizza top quality, but they have some really great styles on the menu, as well as sandwiches, salads and drinks. They serve beer on tap, make calzones and wings, and will make you a gluten-free or vegan pizza as well. On nice days, check out the patio outside!
Lastly, an ode to the title of this blog: the “slices” you can order there? Yeah, it’s two slices. Every time. Last time I ordered two slices to go, it was essentially four because the slice is so big, but they only charge you for the original two! They also deliver into the wee hours and can do large parties. We recently got 12 pizza’s for the Parkmead Pathway Meeting, the pies were hot, it included all the paper products and I also was able to get the sodas in one stop. They also gave my son a job for a few summers and the owner lives up the street from me, so I am a big fan! Give them a try if you have not already, they are located on Cypress next to Philly Cheese Steak, around the corner from where Crogan’s used to be.