Do you know how I know that the mortgage process is a complete mystery to so many people?
It’s not just because I was a loan officer for 15 years and I could hear that in the voices of so many clients. It’s mostly because I still have horrible visions from the day I closed on the first house I ever owned.
My wife and I bought a little Cape Code style house not far from my hometown about a year before I got into the mortgage business. At the time, I earned an embarrassingly low salary as a newspaper reporter. We used our wedding gift money to make a small down payment on a house. We even got a “seller’s concession” to help with the closing costs. We had absolutely no wiggle room, which was super-stressful!
But my loan officer Bob was so confident. He assured me that we’d have more than enough money to make it to the finish line.
At the time, my wife’s job was way more demanding than mine, so I was 100% tasked with everything related to our mortgage. Way back then, I knew nothing at all about what to expect of that process. I relied completely on Bob to guide me. I sent him whatever he asked of me and I signed whatever he told me to sign.
I still remember how nervous I was. But a week or so into the process, Bob had me at ease. He answered phone calls at night, even after dinner hours. That blew me away! I thought, “This guy works for a bank… Since when do loan officers at the bank take calls at 8:30 at night?”
When Bob told me we were “clear-to-close” I was really proud of myself. We were just one step away from owning our own home. That’s a major milestone in the “adulting” process!
We were so excited when we woke up the morning of our closing. It was a specific, highly concentrated brand of excitement that most people only feel a few times in their life. We said hello to our lawyer when we arrived at his office. Our realtor was already there too. She was a lovely elderly woman who often smelled like she recently finished deep frying something in her kitchen. She had a nice gift for us.
I looked around the room but didn’t see anyone who looked like my loan officer Bob. The entire application process was done over the phone, but I’d seen his picture on the bank’s website, so I knew what he looked like. I didn’t find out that Bob wouldn’t be there until we were sitting down at the closing table! My lawyer told me that loan officers almost never show up to their closings, and it was totally normal. But it felt really weird to me. The whole time, Bob was my guide and he wasn’t going to be there to see me complete the journey.
My lawyer took a page at-a-time off the top of a stack, and pushed them in front of us, one-by-one, explaining each document before we added our signatures. We signed for at least 30 minutes. Then the lawyer pointed to a number on a closing document and said, “I need a check for this amount,” then he moved his finger down the page and pointed at another number. “And I need a check for this amount.”
The two figures added up to more than $6,000. Certainly, he was mistaken. We didn’t even have $6,000! Between our earnest money deposit and the seller’s concession, Bob said we wouldn’t need to bring any money with us to the closing. How on earth could we be short by SIX GRAND????
We were terrified that we weren’t getting the house. We were embarrassed. The sellers and their attorney were sitting across from us, watching us squirm in our seats. We had no idea how this could have happened, and we had no idea what to do!
Our lawyer went through the numbers a second time and a third time. All three times, he came to the same conclusion. So, I called Bob. It went straight to voicemail. I called him again. Voicemail again.
Throughout the entire loan process, Bob was there every time I needed him. But now, when I needed him the most, he vanished. I called Bob’s processor, a woman who’d helped me once or twice along the way. But she had no real control over the numbers, and she couldn’t find Bob either.
My lawyer showed me that the bank’s initial estimates were way off for how much we’d need to start an escrow account for property taxes. He also pointed to the settlement statement and explained that the bank charged us “points,” an additional origination fee that they didn’t disclose when we first applied. This was more than 16 years ago, when the consumer wasn’t well protected in situations like these.
Not once…not a single time, in all the conversations that I had with Bob throughout the mortgage application process, did he even introduce the concept of paying points. It was completely foreign to me. So, on top of being terrified and embarrassed, now I was mad too. My wife and I got up from the closing table. I paced back and forth in the parking lot, trying to call Bob on my cell phone. He never answered. My wife called her parents and let them know about our nightmare scenario. She stayed on the phone with them while I went back into the conference room inside the attorney’s offices.
My lawyer told me that he arranged with the title company the option to pay some of the title fees 30 days later. He did the same with his fee and they cut the amount we needed that day in half. My wife’s parents wired us money so we could go through with the closing. But, what was supposed to be a monumentally happy occasion turned into something that felt more like a gut punch.
I never heard from Bob again. The processor and a manager at the bank told me that he was going through some personal issues and he took a leave of absence. Maybe that’s true.
Six months after all of that, I was a mortgage loan officer in training at the Bank of New York. When we bought the house, I never could have imagined a more unlikely twist of fate. But, one of my oldest friend’s husband got into the business just a few years before and he was doing very well. He helped to get me an interview and it just sort of happened.
Our terribly traumatic closing experience guided me as a loan officer. I never forgot the rollercoaster of emotion that almost stopped my heart that day. I overexplained the same concepts to my clients multiple times, to the point that my colleagues at the office made fun of me. I can even remember my kids overhearing me on the phone a few times and saying, “Wow dad, you told those people the same thing four times!”
I never wanted someone to feel blindsided the way I did, so I became an over-explainer. Just in case my client was as clueless as I was when I bought my first house.