How important is the lender you select?
I recently had a buyer back out of escrow on one of my listings the week before closing. The physical inspection was completed and the buyer did not ask for any concessions. The appraisal came in at full value and the loan approval was moving forward inch by inch.
During the last ten days of escrow, the lender had excuse after excuse to delay forwarding the loan documents to escrow. First there was a discrepancy regarding the address, after a week of going back and forth our talented escrow officer convinced the lender that there was no discrepancy with the address. Next the lender wanted a pay check stub from the borrower (yes, 30 days into the loan), then tax returns. The buyers had moved and everything was in storage. They finally said enough is enough and canceled escrow.
I represent the seller and this vacant condo had been off the market for 30 days. Now just before Christmas, it was going back on the market. The purchase contract was written that the buyer would be entitled to a refund of the deposit if the buyer did not qualify for a loan. I asked the buyer’s agent to supply a copy of the lender’s loan declination letter. But the lender didn’t deny the loan, just asked for more paperwork.
The final result was that the seller and buyer agreed that the seller would keep half of the buyer’s earnest money deposit, which was $4,500. The paperwork involved in purchasing a home can be overwhelming. And the loan process can be both time consuming and frustrating. Obtaining a loan in today’s real estate environment requires a lot of patience. Unfortunately some home buyers don’t make it to the finish line.
Refinancing or purchasing, I always recommend that my clients work with a seasoned professional. An experienced loan officer will initially ask for the voluminous pieces of paper required in order to obtain loan approval. But don’t be surprised when/if additional documentation is requested. Packaging a loan is similar to completing a jig saw puzzle…. All of the pieces need to fit.
In the market for a real estate loan? Check out my list of recommended real estate lenders
During the last ten days of escrow, the lender had excuse after excuse to delay forwarding the loan documents to escrow. First there was a discrepancy regarding the address, after a week of going back and forth our talented escrow officer convinced the lender that there was no discrepancy with the address. Next the lender wanted a pay check stub from the borrower (yes, 30 days into the loan), then tax returns. The buyers had moved and everything was in storage. They finally said enough is enough and canceled escrow.
I represent the seller and this vacant condo had been off the market for 30 days. Now just before Christmas, it was going back on the market. The purchase contract was written that the buyer would be entitled to a refund of the deposit if the buyer did not qualify for a loan. I asked the buyer’s agent to supply a copy of the lender’s loan declination letter. But the lender didn’t deny the loan, just asked for more paperwork.
The final result was that the seller and buyer agreed that the seller would keep half of the buyer’s earnest money deposit, which was $4,500. The paperwork involved in purchasing a home can be overwhelming. And the loan process can be both time consuming and frustrating. Obtaining a loan in today’s real estate environment requires a lot of patience. Unfortunately some home buyers don’t make it to the finish line.
Refinancing or purchasing, I always recommend that my clients work with a seasoned professional. An experienced loan officer will initially ask for the voluminous pieces of paper required in order to obtain loan approval. But don’t be surprised when/if additional documentation is requested. Packaging a loan is similar to completing a jig saw puzzle…. All of the pieces need to fit.
In the market for a real estate loan? Check out my list of recommended real estate lenders
Posted by Phyllis Harb at 12/21/2011 2:04 AM 
Categories: Lenders, A Buyer's Perspective
Tags: selecting a mortgage lender
Categories: Lenders, A Buyer's Perspective
Tags: selecting a mortgage lender
Great post. I've had a number of bad experiences with internet loan companies that had no loyalty to the buyer. They always seem to promise the world upfront and then problems arise a few weeks before closing. Fortunately, I was able to hook my clients up with a local lenders who were able to rescue the deals.
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