Scenario: Borrower was casually looking for a new home and found the perfect house that was too good to pass up. In order to make the deal, he agreed to purchase all-cash. He could always obtain a mortgage later on after the closing. Couldn’t he???
PROBLEM: He closed on the house, all-cash. Then weeks later he went to ‘His Bank’ for a mortgage. After all, they were a big, reputable bank, and they valued his business. ‘His Bank’ told him he would have to wait at least six months after closing before they could get him a mortgage. Then they could do a Cash-Out Refinance. He asked his CPA for advice, but received no useful guidance. His Financial Planner advised he speak to Warren Goldberg.
Diagnosis: This current lending environment requires the knowledge, skills, and tenacity of a seasoned, mortgage professional with a proven track record. Ordinary loan officers barely understand the intricacies of their bank’s underwriting guidelines, let alone tax law and their financial ramifications.
Solution: Performed a complete financial analysis and underwriting to confirm the qualifications of the borrower. Explained to the borrower that unless he obtains his mortgage within 90 days of his all-cash closing, his mortgage would NEVER be considered acquisition debt. His mortgage might NOT be tax deductible! (For more information, read my article, The “90 Day Rule.” What Home Buyers Need to Know When Purchasing All Cash.) Originated his loan as a ‘Delayed Financing” Mortgage. And kept his CPA and Financial Planner informed throughout the process.
Result: Mortgage Approved. Loan Closed. Tax Deduction Preserved. A new CPA relationship. An appreciative Financial Planner. And a loyal client for life.
BOTTOM LINE: Most loan officers at the “Big Box Banks” do not have the financial or tax background to understand how your mortgage will affect your overall financial plan. The days of “mortgage salesmen” are over. BEFORE you make a decision that could cost you thousands of dollars every year, consult with a seasoned, professional, and Certified Mortgage Planning Specialist® with a proven track record. Only then can we ensure your transaction goes smoothly, your mortgage complements your financial plans, and that you’ll truly enjoy your new home for years to come.
Warren Goldberg is President of Mortgage Wealth Advisors, a Certified Mortgage Planning Specialist®, and a published author. His interviews include Blog-Talk Radio, Newsday, The Daily News, Anton Press, and the Long Island Herald. Since 1992, he’s been sharing his financial knowledge and wealth-building strategies, including how to properly use your mortgage as a financial tool. His clients regularly express their trust and appreciation by recommending friends and family call when in need of mortgage, real estate, and financial guidance.