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 15-20% of all my transactions are what I like to refer to as "mid-stream" deals. A mid-stream deal refers to a deal that is already under contract and in the midst of the loan process, but an unanticipated problem has placed the transaction in critical condition and at risk of flat lining.

Typically, these sorts of scenarios arise due to one primary reason – a flimsy preapproval process. Usually the situation plays out in the following way:

1. A realtor partner of ours has a listing that is under contract and takes the property off the market;
2. The loan process is set in motion with the buyers preferred lender;
3. With the closing date on the horizon, boxes packed and moving trucks scheduled, the agents on the transaction get a call from the acting lender explaining to them why the deal is unexpectedly going to be declined;
4. Everyone freaks out;
5. The listing agent has experience working with my team and gives me a call asking for a second opinion on the transaction, or as I like to call it, the patient;
6. We suit up like doctors stepping in to take over surgery and gather all the clients documents;
7. Our underwriting coordinator assesses the file, compares it to our unique suite of loan products we offer that don't add on any overlays, and determines the best course of action for the patient;
8. With years of experience in bringing dying deals back to life, we expedite the file and close in record time;
9. Keys are delivered to the new and now relaxed homeowner, commission checks are divvied out to the agents for a job well done, and champagne is served all around to celebrate another life saved.   

9/10 transactions that come to us for emergency support could have been prevented with a thorough preapproval process – in other words, implementing a thorough preapproval process is our industry's form of preventable medicine.  Flimsy preapprovals may be industry standard practice, but in order to continue providing outstanding results we must comply with our own standards, or as I refer to it, "out-standards" deliver outstanding work.

The net result? Our most recent "mid-stream" transaction closed in 7 days…and it was an FHA loan. How's that for out-standards?  

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The views of this blog, "Your Morning Shot" podcast, and on this site in general are solely those of the authors, Matt Weaver (NMLS-175651) and Zack Lewis, and do not express the views or opinions of Finance of America Mortgage.