Recently I helped a couple out who were refinancing their townhouse (they were unable to sell it) and using the equity to buy a new principal residence, while keeping the townhouse with a renter in it. They did not contact me until one week prior to completion on both the refi and the purchase. They were referred to me by a friend of theirs and a previous client of mine. The appraisal on their townhouse did not come back with the value that they needed in order to take enough equity out to complete the purchase of their new home. They were now in jeopardy of losing their $20,000 deposit and also being sued by a whole string of vendors and buyers with offers contingent on the completion of this purchase.
Immediately I began wondering why this appraisal was left to the last minute of this deal? Especially in a market where values on stratified units have been dropping consistently each month. I put my thinking cap on and began going through my mental Rolodex of lenders to see who might be able to help this couple out in such a short time crunch. I immediately got one of my underwriters on board who said “no guarantees, but let’s give it a shot!”
We made sure we structured the deal perfectly and worked tirelessly over the next 24 hours. In the end, we were able to get both deals approved and at best rates, in less than a week! My clients were over-the-moon happy that I was able to save their home and their $20,000 deposit, and are now all settled in in their new home.
The moral of this story? The Broker they originally contacted to handle these transactions persuaded them to use their services by offering to use part of their commission to buy down the interest rate. When asked if I would do the same for them, I politely explained that I get paid what I do for a reason, and there is a reason that within 5 minutes of contacting me, I knew how to structure this deal and which lender to go to in order to save their bacon. This made complete sense to them and the old adage of “You get what you pay for” rang true in their ears.