Mortgage Horror Stories
If you’ve ever bought a house you probably understand the level of documentation and questioning you may incur, odd questions that you may feel have no importance in the grand scheme. Sometimes this is true and sometimes these questions are based in a world that has a reason for them, but on the other side of the coin you can find plenty of home owner stories that prove just the opposite. Here are some some mortgage horror stories that make your situation seem a lot less severe.
Why It Is Important To Work With a Professional Lender:
Our mortgage broker didn’t start our closing papers until 1 week before closing… then he realized for the FHA loan we needed proof of my employment… well technically I wasn’t yet employed, we bought the house in the location where my new job was starting. So it was a total Catch-22, we couldn’t buy the house unless I had 30 days of employment, and I couldn’t go to work if I didn’t have a place to live!!
The only way around this was to get cosigners on the loan. It took an additional 3 weeks of my grandparents running around getting bank statements, mutual fund statements, IRA statements, tax forms, itemizations of all the properties they own with rent schedules, etc. etc. To the point where it put my 83 yr old grandfather in the hospital for 2 months!! RIDICULOUS
Our closing was delayed for a month during all of that – so the seller’s started charing $100/diem for each day we were extended beyond closing. This ended up being a few thousand dollars. We were going to be responsible for it until I threw an ungodly fit to the President of our mortgage company and he ended up feeling so bad that they waived all of our closing fees and paid the per diem.
What Went wrong:
In the above situation it’s pretty obvious these buyers had an absent loan officer, and you often hear about this type of thing (probably far too often). This is a great example of why it’s important to work with a Qualified loan officer. This lender didn’t communicate to his/her clients effectively enough to prevent some costly mistakes. These people could’ve easily lost out on the purchase of their home with these kind of delays.
This Loan Officer Must Be On The “No Call List”
The loan officer was a flake from the start. Taking forever to return my calls, then telling my agent I hadnt called when in fact I left messages, and he even once returned my phone call with an email! BUT he was giving me a 5% interest rate, and the amount I was approved for was over what I was going to offer on the home.
I was ready to make an offer, and he seemed excited for me. After running yet another credit report (which docked my credit 3 pts) and submitting a quote on the home from the Insurance company, he said all I needed was for the seller to pay some closing costs. He was to talk to my realtor about that and send a custom LSR stating only my offer and not my approval amount (approval was higher than offer but the seller doesnt need to know that).
Being a first time buyer I didnt know that an offer had to be SIGNED. So I sat here for WEEKS thinking I was waiting to hear from the seller! I’m one of those people who dont like to pester, but finally I had waited long enough and called the Real estate agent.
While playing phone tag with the agent, I noticed that the price on the house I was interested in had dropped to my offer. I couldnt believe that I hadnt heard anything and here the house was dropping in price.
I called the loan officer and on his cell was a message stating that he no longer worked for that mortgage company. His cell has messages disabled, so I called the company and they dont have my file. They dont know if he took it or what!
When I finally talked to the agent he said that the last time he spoke with the lending officer he was told that I didnt have the full closing costs in my bank account and could not give an LSR. I was in shock. Thats why he said we were going to ask the sellers to pay some of the cost! The real estate agent even asked me if I was sure I had applied for a loan. I looked like a complete idiot. And yes, I did apply for a loan. Thats what the application, two credit reports, tax docs, profit and loss statements (from my business), bank statements, and everything else was for. Oh yes, and those now meaningless words “You’re approved!”.
Now the agent wants me to try and get in contact with the loan officer, but if I do it will only be to tell him how unprofessional he was. I need a few days to calm down so I wont say something I will regret.
Now Im back to square one and will be finding a New loan officer, with my freshly lowered FICO and an interest in a home that is now reduced and probably wont be there once I get approved.
What Went wrong:
This first time buyer had good intentions and good follow through, but unfortunately was dealing with a loan officer and real estate agent that were not transparent about where the client stood. It sounds like the loan officer was preoccupied with other things and left this guy hanging when he needed him most. There was communication between the real estate agent and the lender, but the buyer was apparently left out. Some loan officers and realtors forget that the buyer is the most important part of the transaction. To solve this problem the client could have used a referral from a friend or relative, or maybe checked reviews online.
There are a many stories like this, the best thing you can do to avoid this situation happening to you and your family is to go with a qualified loan officer that has good reviews or recommendations from people you know. Thanks for reading and let me know if I can be of assistance.
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Justin Scott
Loan Officer
NMLS 878581
- C) 920-530-4484
- O) 920-490-8823
- F) 920-490-8967
Executive Mortgage
NMLS 271650
909 . E Walnut Street
Green Bay WI 54301