What specific steps do you use to help your customers find the best home loan for them?
Each customer has a unique story and needs. Mortgages tend to get treated as a commodity with borrowers just wanting to know where they can find the best rate. While offering competitive terms gets us in the door, getting to know a borrower's true financial picture, goals and needs provides the key to providing the right options.
What are the pros and cons of a fixed rate mortgage versus an adjustable rate mortgage (ARM)?
After the financial challenges and real estate market collapse in the last decade, many people have been led to believe that a fixed rate mortgage is the only viable option. However, depending on your time horizon , you can save a significant amount of money with an adjustable rate without a significant amount of risk. If you are unlikely to live in a property for more than 5 years, there is no reason to pay a premium to have a fixed rate for 30 years. Used appropriately, ARMs can be an incredibly useful product, especially if you are disciplined enough to invest the savings or use them to pay down principal. Of course, there is no right or wrong answer. For those that are less financially savvy or unsure of their future, a fixed rate loan can be the conservative safe choice.
What part of the home loan process do customers find most difficult and how do you help them through it?
Many customers believe that we are making an individual risk decision on their loan application and that we ask for documentation to try and convince an underwriter that they are a worthy borrower. While this is true to an extent, in nearly all cases, we can tell up front if a borrower meets guidelines for loan approval. The hard part of the process is obtaining proper documentation to meet compliance and regulatory requirements, not to determine if a borrower is a good credit risk.
One of the things that makes the US mortgage market so competitive is the ability for loans to be packaged and sold in the secondary market. This allows lenders access to inexpensive capital, which can be passed on as low rates to borrowers.
The trade-off is that a loan file has to meet many standards for both regulatory requirements and salability in the second market. Unlike a decade ago, when anyone that could sign the paperwork could get approved, the current environment requires that we fully document a borrower's ability to repay. We have to remind borrowers that we are not only their potential lender, but also their advocate and coach in being able to navigate this complex process.
Summary of where you grew up: family, affiliations, college, high school, etc.
I have an engineering degree from Notre Dame (where I also played varsity football) and a Master's in Management from Kellogg at Northwestern University. I am active with both alumni associations--the Notre Dame Club of Chicago (http://ndchicago.org/) and the NAA (http://www.alumni.northwestern.edu/). Many of my business relationships come through these networks, and I have been blessed with opportunities through my affiliation with these universities. I make it a priority to try and give back to enable others to have the same opportunity.
Tell us something that makes you unique or something wacky, yet interesting about you?
I come from a long line of "bakers" and grew up working in a bakery. My brother continues this family tradition with his company, Five Generation Bakers (http://www.5generationbakers.com/). Although I chose a different career path, I learned a lot of my business skills and values from the many generations of my family that ran their own successful companies.