Why not deal with an experienced professional?
When representing home buyers, Lisa, Natalie and I try to ensure that they work with lenders who are experienced and reliable. Securing a loan in today’s lending climate can be complicated and when working with inexperienced lenders the stress level escalates.
Upon taking your loan application a seasoned loan officer will begin the paperwork avalanche that the underwriter will inevitably require. Once the loan file is ready to move from processing to loan approval, there will inevitably be another round of paperwork requested.
After the loan is approved, there are often more items the lender requires prior to ordering loan documents. The process is often a barrage of one silly documentation request after another. But you have reached this point because your experienced loan officer guided you to point B.
An experienced escrow officer is also invaluable in this situation. Recently we went round and round with a lender requesting a subordination agreement. There wasn’t one and wouldn’t be one, but the underwriter had just enough knowledge to have heard of this document, but not enough to understand the function. Fortunately, escrow pro Kristen Hartwick was able to provide the underwriter with an education.
Here’s my Real Estate Wrap Up:
Glendale Condo (representing seller):
First buyer canceled escrow because they got tired of the lender’s barrage of paperwork. Seller retained half of buyer’s earnest money deposit.
Second buyer's deposit never made it to escrow
Third buyer: The offer and prequalification indicated the buyer was applying for and was prequalified for conventional financing. They misrepresented; the buyer does not qualify for conventional and had to apply for FHA. Although the buyer's loan was in process for over two weeks, the buyer's lender did not realize the condo complex was not FHA approved. (The lender simply checks this by going online and inputting the Association name, it's pretty basic).
Fortunately, the buyer’s Realtor was able to have the buyer switch his loan to Dan Klebesadel at Wells Fargo. If anyone can process the paperwork to get this complex FHA approved it is certainly Dan.
SFV Valley Condo (representing seller’s heir):
Sigh… this is the probate with the title cloud. After more than two years, I have another probate court appearance tomorrow and hopefully this time the attorney has everything together and the Judge will confirm the sale and we can close.
Sparr Heights Bungalow (representing the seller):
The journey to loan documents on this has been a real struggle. The loan officer is either not experienced or indifferent. At least he takes my calls. The buyer’s agent has been great and we work well together.
Our most recent “wrinkle” was that the lender ordered an automatic evaluation (similar to checking zillow) and the valuation came in low. Perhaps because the computer module doesn’t understand the difference between Glendale High and Crescenta Valley or maybe the computer module doesn’t understand that homes in Sparr Heights sell for a higher $ per square foot than the surrounding neighborhoods.
Anywho….. The lender ordered a desk review which is where a different appraiser reviews the appraisal and perhaps finds additional comparables. The review appraiser cut our value by $4,000. What happens next? The lender allows a maximum loan to value based on the purchase price or appraised value whichever is less. So cutting the value, cuts the loan amount, which increases the amount the buyer needs as a down payment. Yes, cutting the value creates a problem.
The buyer’s agent forwarded a copy of the desk review to me. In my former life, I worked in real estate lending and at one point in time, supervised our appraisal department. (see where an experienced real estate agent comes in handy)?
I examined the desk review and learned that one of the new comps used was not sold through the Multiple Listing Service (MLS). I pulled the data from the last MLS sale (2001) and the remarks indicated that the fireplace was inoperable. Voila! No credit should be given for having an inoperable fireplace. And there was nothing to prove that the fireplace was fixed, so eliminate the credit or toss this comp.
I submitted the documentation and a cover letter to the lender. The lender submitted to the appraisal management company. The management company submitted to the review appraiser and I think we will be okay.
Glendale Short Sale (representing seller’s heir):
BofA short sales are input online. This is a very complicated transaction; there are two different sets of heirs. One side is a short sale and a probate. It’s been about a month and BofA's computer system has yet to understand that the owner is dead. We talk to them but it seems their computer platform doesn’t have this option. Lisa keeps reinputting the data and they keep rejecting. But I have every confidence that Harb & Company will get this done.
La Crescenta Short Sale (Lisa representing the buyer):
After 7 months, the 2nd TD holder has decided that they want a $40,000 payoff, which the buyer needs to pay. The buyer has finally given up and walked. Be interesting to learn at what price this home ultimately sells. I think the 2nd overplayed their hand on this one.
La Canada Sale (Lisa representing the buyer):
The journey to loan approval is always a struggle, but we will get there.
Last week was challenging. I have three new upcoming listings, but this post has been long, we’ll chat about those later (or call me).
Categories: In a Realtor's Week, Lenders
Tags: real estate professional
Comments