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Residential Mortgage Lending With Yale Wolf, March 2016

Yale Wolf (March 2016)

Residential Mortgage Finance With Yale Wolf, March 2016

Our friend Yale Wolf is a residential lending specialist at PHH Home Loans, LLC.  A seasoned professional, Yale has worked in the banking and mortgage industry for over 15 years.

House Heroes spoke with Yale about the state of the residential mortgage lending.  Check out his thoughts below!

Q:        Good afternoon, Yale.  Thanks for providing your insight into residential mortgages today.  How did you originally get involved with mortgage finance?

A:         That is a great question, I always was interested in financial services and real estate.  My father invested in real estate, and when I was young, I often traveled with him to sites in the Boston area.  I obtained a finance degree at college, and at that time knew I wanted to be involved with mortgage finance.  After graduating, I worked as an asset manager for a large investment firm in NYC, often involving real estate investments.  I fell in love with the industry and the idea of helping people purchase homes as well as safe money in a refinance.

Q:        Can you let us know your educational/work background, as well as current employment?

A:         I went to school at Hofstra University and graduated with a finance degree.  From there I worked in general investments, and now mortgages for the last 9 years.  I currently am a branch manager at PHH Home Loans, the 5th largest loan originating company in the nation.  My branch is at Coldwell Banker in Waltham, MA, where I am able to work and build relationships with the realtors while originating loans in Florida, Massachusetts, California, and New Jersey.

Q:        About how many mortgage transactions have you been involved in?  Can you describe your roles in these transactions?

A:         I have been involved in close to 700 transactions over my career as a loan officer.  My role differs depending upon the deal.  For different programs, there is a different process.  Not one mortgage is for everyone.  I have Conforming, Jumbo, VA, FHA, and State Housing loan programs.  Within these programs, there are varying documents needed to fulfill the conditions of the loan.  My role is representing the bank and gathering initial documentations, application intake, loan submission to my processing team, and follow up Underwriting to ensure timely closing.  I act as the quarterback.

Q:        Some of our audience may just be considering home ownership and looking to better grasp mortgages.  Let’s start with the basics.  What is a “residential mortgage” and what is it used for?

A:         A Residential Mortgage is a loan that one or more persons receive in order to buy a house or other residential property in which they will live. The loan is secured by a lien on the property; the borrowers repay it over a specified period of time. The interest on a residential mortgage is tax deductible under most circumstances.

Q:        What is an “interest rate” and how does it impact mortgages?  How is the interest rate set?

A:         Interest rate is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets. Interest rates are typically noted on an annual basis, known as the annual percentage rate (APR). Interest rates impact a mortgage by payment.  Lower the rate the lower the payment.  At their core, the interest rates we pay on borrowed money for our businesses are set by the Federal Reserve. The U.S. Federal Reserve System (“the Fed”) is the Central Bank of the United States.

Q:        Are there different kinds of mortgages?  What types are most relevant to typical home owners?

A:         The different kinds of mortgage loans consist of conforming loans $417,000 max, Jumbo $418,000 plus, VA loans $417,000 max, and FHA loan amounts differ by county.

Q:        How does a home buyer qualify for residential mortgage?

A:         Borrowers need to fill out an application and supply the loan officer with tax returns, w2’s, bank statements, and paystubs to assess the maximum loan a borrower can qualify for.

Q:        Assuming a home buyer is qualified, what is the step-by-step process for a home buyer to obtain the mortgage?

A:         Fill out an application, send in income documentation, review loan programs with the loan officer, choose a program, lock the rate and program, send in additional conditions requested by the underwriter, then close.

Q:        Do different mortgage rules apply to residential properties vs. commercial properties?  Can you explain?

A:         The difference between a commercial loan compared to a residential loan is that as the loan officer you are not approving the borrower, rather, you are approving the building based on the building’s income production.  For commercial, a person or entity guarantees the loan.

Q:        Florida has a substantial amount of distressed property.  Will houses in poor condition quality for a residential mortgage?

A:         Yes, distressed property does qualify for an FNMA, Freddie mac loan.  Guidelines exist for investors regarding these types of properties.

Q:        Do mortgage rules differ for owner-occupants and absentee owners (i.e., owners that won’t live in their home, but might rent it out)?  How so?

A:    The primary difference between owner-occupied and investment properties is the down payment.  Owner occupied the minimum down payment is 3%, where investment is 25%. Also, for investment properties, the income being produced by the property if occupied must be at 75% of gross rent and if it isn’t occupied it’s 65% gross rent.

Q:        How does a homeowner know they are getting a “good deal” on their mortgage?  Should they shop around?

A:         Mortgages are like other services, such as a lawyer representing a client.  There are firms that charge less than others, but don’t give the same service or representation.  Every bank will try to one up each other on rate or cost.  At the end of the day, it is about the relationship.  A good loan officer ensures their clients are taken care of.  We are in a relationship business.

Q:        Let’s discuss the state of residential mortgages today – March 2016.  What are interest rates today?  How does this stack up historically?

A:         Rates are historically low due to the foreign markets and China.  As we know China, is not forthcoming in their true earnings.  There are many other variables to consider, such as that interest rates are regularly low during election years.

Q:        Is it a good time to buy a house with a mortgage?

A:         It is a great time to buy a house with a mortgage.  The rates are low, allowing buyers to afford homes with a lower monthly payment.

Q:        As a residential mortgage specialist, what are your biggest challenges?

A:         My biggest challenge as a loan officer is being able to quarterback my team as well as manage the expectations and process of obtaining a mortgage.

Q:        When you’re not working on lending, what do you do in your free time?

A:         When I am not working on my business, I am involved in community activities, golf, baseball, hockey, and the gym.  Not to mention being a loving husband to my wife.

Q:        How can our readers contact you to enlist your services?

A:         You can contact me at

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