Recently I have been working on a young couple's application for mortgage that has been less than simple and filled with roadblocks. Lower credit numbers than previously portrayed during initial conversations were the first hurdl
e that cropped up and caused some anxiety. Then came the choice of property. The home had some "issues" and they only made the appraisal and subsequently the lending more of a challenge. That the purchase was being arranged for and sold through a government-owned agency added to the dilemma. It was also becoming quite clear that the realtor representing the couple was inexperienced in this type of transaction. All sorts of landmines were being discovered.
Now let me be clear, in today's financing world it is not easy to say what the hard and fast rules regarding some lending programs are. Sometimes they change quickly or they are not always clearly defined. Underwriters within the same company can sometimes vary on their needs and requests. Constant vigil is demanded (and many phone calls) to stay on top of the new and changing regulations and programs and even veterans of the mortgage industry are breathless trying to keep up. So, it's easy to see why it could be confusing and very hard to stay current.
Caution should be the word for anyone writing a contract and also for lenders quoting availability of programs. Before contracts are signed and promises are made, especially in transactions involving short sales, foreclosures, government agencies and special programs, questions should be raised regarding the wording, timin
g, and special needs attached to lending requirements that may apply. If a dialogue between realtor, buyer, and lender takes place, many future problems may be avoided. In the case of the young couple that I am currently assisting, I had to ask for clarification on records and follow-up documentation in order to pave the road to a clear closing. All-in-all nothing huge, but aggrevating to them and sometimes hard to explain as well.
I suggest that now, while the industry is a bit wobbly and changes are coming so rapidly, that extra precautions be taken to insure as few problems and stumbling blocks as possible. Take the time to make those phone calls and seek the information you need. Open up that dialogue. Your buyers and lender involved will be most appreciative of the extra efforts made and care you exhibit. Deals that may have not closed otherwise will experience smooth sailing also!
Gene Mundt, Professional Mortgage Banker www.genemundt.com Chicago Bancorp
Gene Mundt, Sr. Vice President
Personal NMLS #216987
The Federal Savings Bank
1823 Centre Point Circle, Naperville, IL 60563
Skype! 630-219-1316
I agree that the buyer's agent should probably have a conversation with the buyer's lender prior to writing an offer. Often the buyers don't necessarily understand the loan they are getting so they can't accurately describe it to their agent to put in the offer. Also the lender sometimes provides information that the buyers left out, inadvertently or otherwise, that might be important to the transaction. Thank you for the good post.
Gene, this has become so much more important in this shift market. You are right!
Thanks for the posts and comments on the topic of prior dialogue and discussion between professionals. Some preliminary thoughts and conversation sure seem to make the process (and processing) go much more smoothly.
It helps me to know other real estate professions views on these issues. Thanks for the feedback.
Gene Mundt, Professional Mortgage Banker www.genemundt.com Chicago Bancorp