While everyone is buzzing about 40- & 50-year mortgages to solve affordability, Next Wave Mortgage’s Phil Ganz believes the real story—& the one being missed—is what he calls the "anti-50 year" mortgage hack.

Ganz says he’s found a “massive loophole” in both FHA & Conventional scorecards: Shortening the term is the single most effective way to flip a "Refer" to an "Approve." 

“Most LOs are terrified of higher payments, but for high-income/low-credit borrowers, this is the magic bullet because of velocity of equity,” he told The Scoop.

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Here Ganz’s deep dive into how a velocity of equity play works: The AUS doesn't just look at DTI; it looks at how fast the lender gets their money back. (Ganz ran the numbers by the Chenoa Fund.)

The "Hack": In just 5 years, the borrower has more than double the equity stake ("skin in the game") on the shorter term. The algorithm sees this rapid de-risking & flips the finding to "Approve/Eligible," even if the monthly payment is significantly higher.

Real-World Proof (Happening right now): I have a file right now with Chenoa (FHA DPA) that is a "Refer" at 30 years & even at 25 years.

It works for conventional, too. Last month I had a Fannie Mae deal: 622 FICO, investment property, 15% down.

“I don't think enough people know about this,” Ganz said. “Everyone is so focused on lowering DTI to get approvals that they forget about ‘Risk Layering.’ Shortening the term eliminates the risk layer entirely.”

What do you think about Ganz’s hack? Email me at [email protected].

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Owning Manhattan’s second season 🏗 is out on Netflix. The reality show follows agents at Ryan Serhant’s eponymous brokerage as they broker multi-million dollar properties 🧧 & generally start fights w/ one another.

Anyway, it got me thinking: Why aren’t there any reality shows on mortgage lenders/LOs? You cannot convince me there isn’t enough drama in the space & I think it would be instructive for consumers to see how mortgage really works.

The closest thing that’s out there is a fun web show by Fairway called “LO Confidential.” The series tells the story of how several Fairway team leaders are navigating a tough market. Also, no one would mistake it for a Bravo/Netflix-style show – it’s pretty light on the drama & catfights.

Share your thoughts w/ The Scoop: Who should get a mortgage reality show? Who would star in it? What would it be called?

When New American Funding made the news in July for having the data of 50K customers exposed, they made a pretty simple decision: terminate the relationship w/ the vendor that was breached, Mobile Notary Zone. But few lenders will be able to do w/ SitusAMC, which was hacked a few weeks ago & exposed the data of an undisclosed number of people (but probably hundreds of thousands, if not more). 

SitusAMC touches about 2/3rds of secondary market due diligence & represents a single point of failure for most of the industry. As Michael Kelleher recently pointed out, it's effectively a mortgage utility. Think about the playbook that got us here: outsourcing for savings, consolidating for efficiency & sending it ashore for margin (Jobs sent to India, including underwriters & tech staff). 

“The uncomfortable question: Is fragmentation actually our best protection? As we race to unfragment, consolidate, and scale—are we building efficiency or vulnerability?” Kelleher asked. “Because here's the trade-off nobody presented to the board: Variable cost savings vs. single point of failure inserted into your pipeline. Every loan that moves from lock to Wall Street follows pipes. If the exit pipe is compromised, every loan is exposed. This isn't about blaming one vendor. It's about asking whether our vendor assessment process is broken.”

The bipartisan-supported “Road to Housing” bill isn’t happening. At least not yet. The bill, which contains 40 provisions to address housing affordability & supply, was not included in the final text of the National Defense Authorization Act. It’s the first comprehensive housing package in almost a decade. Supporters are optimistic they can get it in another bill in ‘26.

At the local level, there are some states/cities making interesting moves w/ regard to supply. Charlotte recently passed a new law that offers up to $80K in forgivable financing for ADUs. It resulted in the creation of nearly 200 ADUs. Predictably, many of the ADUs built are being used as guest suites or short-term rentals…

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