Financing in San Francisco>Question Details

RSW, Other/Just Looking in Belmont, CA

loan agent keeps calling it a "full approval", as if to imply I'm further down the road/process than my "preapproval" from a

Asked by RSW, Belmont, CA Fri Jul 16, 2010

2nd source... true/false? He's told me this time and again, and I haven't bothered to look it up until tonight. Is he smoking crack? I recall him telling me multiple times basically "what you have here is a FULL APPROVAL and X just needs to be checked out so you can get into your home". I think I'm being gamed. He has my credit card authorization for the appraisal I sent today -- I can cancel it but I should do it sooner than later. Any advice would be quite helpful.

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The mortgage brokers will correct me if I'm wrong.
First step is you submit data and you qualify for a loan. You qualify - you might qualify fully - it only means that you are credit worth. The next step is to have a ratified contract that meets lender quidelines and then an appraisal that give the sale or higher value. Now all that goes to the underwriter who can put conditions on the loan. Get the termite work done - get a document - check the sewer etc. There is no complete approval on a loan until the contract to lend is signed and ratified. Until the money is placed in escrow by the lender, the lender can change its criteria be bought, go bankrupt just say forget it.
If you don't feel trust for your lender or your agent fire them as soon as possible. If one finds themselves in the position this person is in pay close attention to the process and start working with another lender ASAP.
Always ask "are you ready to fund the loan and if so when will the loan be funded"?
0 votes Thank Flag Link Fri Jul 16, 2010
Jed Lane; Fog…, Real Estate Pro in San Francisco, CA
MVP'08
Contact
Once Again... WHO IS THE LENDER?
0 votes Thank Flag Link Fri Jul 16, 2010
What's the problem with this lender why you would want to cancel? As has been stated, there is no "full approval" without an appraisal. The appraisal is a condition of approval so at best it would be a conditional approval. You can cancel any time you like but make sure you are not placing yourself in a worse position by doing so.

Gregorio Denny
Tripoint Mortgage Group, Inc.
800-335-6897
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Fri Jul 16, 2010
Mortgage companies take a loss if they lock in a rate and then you do not close the loan with them (they hedge their locks, and that costs money) , so most of these internet companies want you to pay for the appraisal before they will lock you in. They want to be sure you are very commited. I know there are some online mortgage companies that will go so far as to have the property appraised but then only choose the cream of the crop loans to actually close -- after a lot of hassle and requests for more and more documentation.

Many of these online lenders quote low rates at first, but that's rarely the same rate you end up with, since they can't lock it in right away. For many buyers out there, the promise of the low rate seems to make all the hassle -- and drama -- somehow worthwhile.

Most, if not all, of the good realtors in the San Francisco market will want you to work with a local lender for all of these reasons. You might not end up with the very rock bottom rate -- you may pay .125% or ..25% higher in interest rate, but you can be assured you are dealing with someone of integrity and that your transaction will actually close.

Sound to me like you have made a choice to work with an online lender -- that may or may not work well for you. Will you promise to let us know how everything turns out?
0 votes Thank Flag Link Fri Jul 16, 2010
I'm suspicious because I'm already in contract, and I've already sent over all documentation to get what has repeatedly been called a "full approval". It seems suspicious because I need to take the financial commitment of paying for the appraisal before I lock-in to a rate. It just reeks of a bait-and-switch situtation, or does it? I'm just asking since yes, this is my first time buying, so I might seem more careful that most people.
0 votes Thank Flag Link Fri Jul 16, 2010
You haven't told us where you are in the process; have you found a home and are you in contract, or are you still shopping for the home?

In any event, why are you so suspicious? Is this someone you chose because you felt he was trustworthy? Then give him a break please. He could be telling you the truth. If you are not working with someone you trust, how did that happen?

That said, I use the same wording myself. Pre-approval means we have chatted on the phone and I've given you a rough price range. then you give me your paperwork and after a few days you are "fully approved" by a real bank subject to further coditions like a property appraisal and title report. These days, we need your credit card to charge the approval; the appraisal management companies will not accept checks.

Once all of the conditions have been removed from your loan (i.e., the appraisal has arrived and has been reviewed the lender), you have "Final Approval" and we will order your loan documents.

natasha
0 votes Thank Flag Link Fri Jul 16, 2010
You do not have full approval until all conditions have been met. Usually a buyer will get a conditional committment which lists th conditions that are needed for your loan to close. If teh house has not been appraised yet, there is no way you have full committment or approval.

You should have received a letter which lists the conditions once receiving initial appraisal, it would state closing the loan is contingent upon a satisfactory appriasal, a final review of your credit before closing and a verifcation of employment before closing as well as a review of teh title and teh title being clear, thsi are standard.

Ask him for a copy of your committment lender.

Good luck with your purchase and with working things out
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Fri Jul 16, 2010
Could just be unfounded fear ... but my gut feeling is I'm getting gamed here - please help so I can put a hold on my credit card.
0 votes Thank Flag Link Fri Jul 16, 2010
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