Financing in San Francisco>Question Details

Craig High, Real Estate Pro in 94115

Why are banks not loaning these days?

Asked by Craig High, 94115 Tue Apr 24, 2012

Banks have made the loan process next to impossible. The hoop-jumping is endless and then when it's time to close, you can't because something ends up being wrong, missing or they drop the ball without following through.

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We are starting to see some loosening by the banks for loans to better qualified candidates in Louisville, Ky. They are still deathly afraid of approving the wrong candidates.
1 vote Thank Flag Link Thu May 17, 2012
Yup - you're preaching to the choir. Interest rates are at recotrd lows but great numbers of the population don't readily qualify. I'm afraid it's still a reactionary stance to the mess created in 2004-5 when everyone with a pulse qualified.

Let's all pray that the lenders get back to a middle, more sensible approach to mortgage approvals.
0 votes Thank Flag Link Tue May 1, 2012
Banks are loaning. You just have to have Brass B__l's and not really need to borrow money.
0 votes Thank Flag Link Thu Apr 26, 2012

There is no doubt that the loan process is more complicated than it used to be. Best evidence of such - we had a client who had excellent credit and was putting down 50% on a $2.25M house and they made him take an online quiz about managing his credit.

Because of the subprime debacle lenders (in part because of govt regulations) have tightened up the process, and you have underwriters who are super careful to make sure all the i's are dotted and t's are crossed - sometimes for ridiculous things - because they don't want to get called to the carpet for missing something.

That said, we have not had a single loan not go through with the lenders we regularly use. The problem is that there are many lenders/mortgage brokers who will tell you no problem on the front end to get your business and hope it goes through.

There have been a few buyers who were told by our preferred lenders that they couldn't give them a loan. The difference between them and you is that they were told on the front end.

What you need to do is speak with some lenders who are ethical, responsive, and honest so you can get a true picture of if you can qualify and for how much, or what you need to do to be able to. If you would like referrals drop me a line or give me a call.

Best Regards,

Lance King/Owner-Managing Broker
DRE# 01384425
0 votes Thank Flag Link Wed Apr 25, 2012
Asking for documentation that proves one's income, assets and employment is hardly hoop jumping. There are many reasons files don't get approved and most of them are error on the part of the loan officer or the borrowers themselves. There is no reason anything should be "missing" in a file; and experienced loan officer would make sure of this.
Web Reference: http://HarpSupport.Com
0 votes Thank Flag Link Wed Apr 25, 2012
Hi Craig-You are right that the process feels endless. Loans do happen when a proactive realtor and a quality loan officer get together from pre-approval to the closing of the deal. Knowing what you should be able to buy and if there are any hurdles that need to be cleared early in the process is most of the battle. There can always be problems after that, but if your officer and realtor care and give your transaction the attention it deserves, it will close. Let me know if I can help. Best-Matt Ciganek
0 votes Thank Flag Link Wed Apr 25, 2012
You need a Loan Broker who knows which banks to place your Loan with. I can refer you to 2 that have helped my Buyers get through the hoops quickly. Just call me at (415) 308-5902.
0 votes Thank Flag Link Wed Apr 25, 2012
It's not that they aren't lending, they are just being overly cautious. "a" borrowers can get loans, and yes there is a lot of hoop jumping involved
0 votes Thank Flag Link Wed Apr 25, 2012
Hi Craig,

I just heard that yesterday at my open house. My response was buyers now need to show the lenders they have the ability to pay them back. What a novel thought.

The fact of the matter is that it is more difficult to get a loan, that's why you need to work with a true professional who is proactive, not reactive when it comes to getting a loan. If you get what is needed up front, you usually don't have those problems when it comes time to close.

And some lenders are a pain in the a.. , to be honest.


0 votes Thank Flag Link Tue Apr 24, 2012
Working with the right mortgage professional is a must in this market environment, I'll be happy to provide you a couple of seasoned mortgage professionals.

Feel free to call me. 415-200-7202
0 votes Thank Flag Link Tue Apr 24, 2012
Many lenders cherry pick borrowers to minimize their risks as much as possible. Just like they were too loose with lending not that long ago, now they are too tight. It can be very frustrating for buyers however, it is getting better very slowly.

Buyers need competent mortgage professionals to help them prepare for all the "hoop-jumping" and avoid the many pitfalls. Let me know if you need recommendations.


Oggi Kashi
Broker Associate, Paragon Real Estate Group CA DRE 01844627
All data from sources deemed reliable but subject to errors and omissions, and not warranted.
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0 votes Thank Flag Link Tue Apr 24, 2012
Before the financial crisis, they had almost no requiremrents in giving out loans. Now, after the fallout, they have gone to the other extreme and are requiring everything under the sun and then some. Knock on wood, I haven't had any major issues with loans for my clients but I know many people that have so you are not alone. I sympathize with you. You may try a different lender since every one has their own strict requirements nowadays. Let me know if you need any referrals.
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0 votes Thank Flag Link Tue Apr 24, 2012
Hi Craig,

It sounds like you may have had an issue with a lender. Banks are lending and frequently. The process is harder than it used to be in the early 2000's, but they are really only doing what they traditionally did - check, check and check again.

If you work with a good agent and a bank / mortgage broker, you should be able to be pre approved and not only find a place to buy, but working closely with your agent you should be able to get over nearly any hurdle, and in most cases see the problem as it starts and head it off.

Please feel free to call for referrals.

0 votes Thank Flag Link Tue Apr 24, 2012
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