Lending Horror Stories? Slow Closes? Share Them Here! 37 posts by 22 users

Posted: 04/03/2008 at 10:59AM

I've been dealing with a couple of property sales for the past few months and have horror stories to share! I won't get into all of the details, but in essence, in both sales, I've got HIGHLY qualified buyers with great credit, cash in the bank, good net-worth, high incomes, and low and behold, we can't seem to get these deals to close. In both cases, the buyers are dealing with mortgage brokers . . . in both cases we've gone MANY WEEKS past initial close . . . in both cases, after 3-4 additional weeks of lies and misrepresentations from both banks and these mortgage brokers, the loans did not come through. We're still trying to get loans on these properties with new banks, but I must admit that I'm at my wits end here!

I've contacted the offices of several people in Congress and they want to know who is is having these problems! I'm certain that I'm not alone here, because I've heard from others in the biz that that is not the case.

THE MORTGAGE BUSINESS IS IN COMPLETE DISARRAY
When qualified buyers cannot close on property, there is something very wrong!

Congress is currently holding hearings on the housing crisis and the mortgage industry, and we need for them to know what is going on!
If you, like me, has experienced a situation where perfectly qualified individuals can't get a loan, please post your story here!

We have people in Congress who want to know what you're going through and I am trying to get information together so we can present this to them.

Is your lender blowing you off? Are you more than qualified, but constantly getting rejected for loans? Is your mortgage broker lying to buy time? Are you a mortgage broker that is getting the run around by the banks?

If so, please share your story here!

[b]We must come together as buyers and sellers and let the government know that this is not okay!

Not only is this helping the housing crisis to worsen, but it is also bringing our communities and neighborhoods down![/b]

When people want to buy property to rehab and clean up, but are unable to do so, we all suffer!

PLEASE SHARE YOUR STORY HERE!

BTW - If you are a mortgage broker and have been having problems with banks closing, please also feel free to share your story here as well.

Posted: 04/12/2008 at 08:47AM

[[[[[.......... congress needs to step in and help in assisting qualified borrowers that should be able to obtain a loan but cant .......]]]]]

Sorry, guys, but I don't see where it is my job as a taxpayer to provide mortgages for your clients-- who probably have more money than I do to start with.

Posted: 04/14/2008 at 12:44PM

Unfortunately, your job as a taxpayer is to pay taxes. I’m sure that you’d like to believe that you have a reasonable amount of control, this being a democracy, but you don’t. I would like to quote an essay that I read recently, it’s called 545 people by an author named Charlie Reese:

One hundred senators, 435 congressmen, one president and nine Supreme Court Justices – 545 human beings out of 300 million – are directly, legally, morally and individually responsible for the domestic problems that plague this country.

I completely agree with that statement. Now, it is definitely in your best interest as a taxpaying citizen to have someone try to fix this problem. Whether the people who fix this problem have more money than you, or whether people who have more money than you benefit more from the proposed solutions (tax dollars) are totally irrelevant. The point is that this problem needs to be fixed. The reason why the Great Depression lasted as long as it did, with the severity that it had, was due to the incorrect approach by Andrew Mellon, the Secretary of the Treasury at that time. He thought that economy would rebound quickly if the government stayed out of it. Nothing could have been further from the truth.
We need people buying stocks, real estate, businesses, commodities and labor. The banks are going to have to calculate their losses and get back into the game, and people who borrow money will need to be more accountable for irresponsible fiduciary.
We must fight for redemption. Fight to hold true to all that is good in this country and all that is good in this life.
If we don’t, we will all lose.
You will lose your chance to borrow money. You will lose your chance to get a small business loan. This country’s financial reputation will be destroyed in the eyes of other nations!
People who default on any financial obligation should be held accountable for every penny AND assigned to community service! If you don’t feel like working to pay your bills then you can work for not paying them.
Financial institutions should be given tax loopholes inversely proportionate to their level of charge offs and REOs. This would actually hold their feet to the fire and encourage them to work with people in default.

Posted: 04/14/2008 at 04:30PM

Here's just a small example of what we're going through here . . .

The following was just emailed by the underwriter to the LO of my Buyer:

" Appraiser to address and comment. Appears in 2nd level baths the shower extends beyond where window is. Windows appear to be fitted with shutters. Appraiser to address if this is a possible code violation in more detail and if window can be opened or is it sealed. Addl conditions may apply."

This is the kind of mundane crap that Citi Mortgage is using to hold up funding a loan! They needed us to take new photos to show that the shower doesn't extend past the window, and wanted pics with the window open to prove that it works.

Believe that?

Posted: 04/24/2008 at 09:22AM

I think what he means is that in the overall scheme/big picture that he dislikes how the government is " bailing out" the mortgage company. If you read in the NY Times, CNN, anywhere with a decent news feed. The argument is that these banks and mortgage lenders are getting what they deserve. It is because they originally lent to unqualified people that they are now in financial trouble. And, to top it all off, all the money being poured into that sector is from, obviously, taxpayer dollars. But at the same time, this creates problems for people who are genuinely able to pay their debts (if needed) and are qualified, but banks are holding out trying to wait for the bailout.... at least that's what I think he's saying from his little quote there.

Posted: 05/17/2008 at 09:55PM

Joshua,

I had the same problem buying properties recently. The first lender had me down a rat hole until I got the referral of someone who did the impossible and pulled off our 3 deals -- closed back to back April 28 & 30. No details needed, good rates, did everything he said he'd do. I can't wait to refer him. He's licensed in 50 states. I'm not sure if I can do that on the forum but you can contact me and I'll be very happy to put you in touch with him.

Posted: 05/23/2008 at 06:52PM

Some of your stories are pretty funny. We're not having any problem closing loans for truly qualified people. Most of you boys are too young to understand that the banking industry is just now going back to the way it's supposed to work. Given that it's obvious to them that appraisers were in the realtor's and morgage broker's pockets, you really can't blame them for being careful.

The essential thing that's happening is that it's finally becoming apparent that without a manufacturing base, WE DON'T HAVE A FUNCTIONING ECONOMY. Most lenders know this and are only going to loan to people who have a job that is stable.

Given that we now have a global economy, and we have no manufacturing, our standard of living will go down until we start making the things we use and start exporting, or until we're below average in the world economy.

Common sense isn't taught in college, but it still applies in the real world.

Posted: 06/04/2008 at 03:28PM

Alright, I know the topic is " horror stories," and that we all like to kvetch and debate who's to blame for war...government or soldiers of fortune...but where do we go from here?

With all the underwriting madness and unfair practices, how do we usurp the system?

1. Quitclaim buyers onto title with side contracts stipulating they get off if can't refinance house (which can often be easier) into their name in certain time frame?
2. Land contracts?
3. ???????

Posted: 06/05/2008 at 04:54PM

Then , next time there will be no deal, for vast majority ( if not all) of the banks will not " amend" the contract the way it would have not benefited them....

Posted: 06/25/2008 at 08:22PM

Let me repeat myself, guidelines are changing literally overnight!

I had a loan all buttoned up, only to hear that Fannie/Freddie imposed a nationwide 5% " declining market" LTV cut. OK...realtors got up in arms and convinced F/F that F/F had instituted a self-fulfilling prophecy and to knock it off. F/F reconsidered their position and reversed the automatic 5% declining market LTV cut but many lenders cut LTVs across the board for FICO or other risk factors. Result? Same/same!

It's crazy out here.