Home Buying in Brea>Question Details

Servando Gom…, Home Buyer in Kingsville, TX

How do i know im not getting fooled?

Asked by Servando Gomez, Kingsville, TX Tue Apr 23, 2013

I applied with Network Funding and got approved. found a house, got an approval letter so we placed a bid. Bid 500 over asking for a HUD home. paid the Realtor 500 plus 1000 earnest money. ha to get inspectors and utilities on for the inspectors. 2 weeks before closing the underwriter denied my loan. said debt to income was to low. Even after i explained everything to the loan officer and was approved. i was told i need a co signer. I was angry but still found one. I had to pay 350 for an extension. now there saying it still isn't enough. what can i do? I feel mislead. if I would not have been approved I wouldn't have spent money on a house we cant get. Is there laws to help?

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You were probably misled but there is yet another caveat: any time you get pre-approved it hits your credit.

Effectively, we, for example, bid on homes in CA, we did not get. But our credit got hit even though we have O debt and excellent credit.
0 votes Thank Flag Link Sun Sep 15, 2013
Servando.
Lets move forward now and see if I can help I have a question for you
Do you have time to save this before canceling. I have a lender who help can in these types of situations. I have used him before and helped an Olympic silver medalist get her house when her friend a lender messed up her loan. She was not happy with her friend
Anyways contact to see if this is something you still want to do and still possibly can do. Keys see what can be done now
The biggest obstacle right now is offers falling out due to financing
Then once this is done start contacting the dept of real estate, the attorneys office and lenders organization to file a complaint. I may not have all the info to what has transpired in your situation

Talk to you soon

Ingrid Ski Realtor
949-874-0432
OCAreaHomes@gmail.con
0 votes Thank Flag Link Thu Apr 25, 2013
Hello Servando,

It sounds like you are in a very tough situation and not getting any answers that you feel help your situation out one bit. Based on what you wrotem, there are a few items that might still be unknown and a few that need to be clarified to you. You stated that you paid the agent $500.00 plus $1000.00 earnest money, I am wondering if you don't mean that you gave your agent $1500.00 and that it was intended as your earnest deposit to escrow. It also sounds like you might gave been pre-qualified for the loan and not issued a loan approval... these items are very different.

Now, without trying to draw way too many uncertain conclusions, the one item that I have the most questions with is this... if you were told that you needed a co-signiner and was able to find someone. Were you told specifically what the minimum qualifications for this co-signer would need to be. Where you in need of the co-signer simply becuase your debt-to-income was too low, and you needed someone with a certain set of criteria? After the co-signer information was sent to the lender, were you first told that all was fine and them told that, yet again you did not qualify?

Lenders are becoming more and more demading with their lender criteria. As such, you might not have many options unless the lender expressed to you after the co-signer was found that all was okay.

If you care for some additional information, feel free to contact me.

Best regards,
Jorge Granados
DRE # 01323782
0 votes Thank Flag Link Tue Apr 23, 2013
Contact National Association of Attorney's General. Bait and Switch tactics are consumer fraud. Also if the lender was referred by the real estate agent contact HUD and advise them as HUD agents are approved by HUD to sell their homes. You can also contact the Department of Real Estate As Well. I certainly would escalate a compliant with the lender not just their manager but the President of their company regarding the misleading loan approval.

Let us know how it turns out. Hope you get your money back.
0 votes Thank Flag Link Tue Apr 23, 2013
Yuck! What a mess. There's a lot of info we are not privy to here including if there is any new debt you acquired from the time of the first approval to the time you were denied. If so, that can change things and it wouldn't be the lenders fault.

If nothing has changed in your situation, you should still be aware that lenders usually have verbage in their prequal letters giving them an easy back out. Not to kick you while your down but this is the #1 reason REALTORS recommend you get approved with a lender with a reputation of property qualifying clients before they start looking.

You need the specific underwriting guidelines that you don't meet. If they can't provide or its something they had knowledge of prior to your first approval or should have easily been able to ascertain, then you can talk to an attorney. Unfortunately, this may be more expense than it is worth.

I'd really dig in to the situation with the lender and let them know of the hardship this is causing and that their failure to properly prequalifiy you is making you liable for sellers damages. In return, you'll be holding them responsible for any of your damages from this situation. Attempt to get them to either fund the loan or refund your money. Then you need to talk to your agent and attempt to salvage the deal with a new lender, somebody who comes with a trusted reputation.

Unfortunately, if you can't salvage the deal you may be cancelling your escrow and losing your deposit. :(

Good luck, we'll keep our fingers crossed for best case scenario.
0 votes Thank Flag Link Tue Apr 23, 2013
Hello Servando,

I'm sorry you are going through this.

Make sure that you had a pre-approval and not a pre-qualification.
Pre-qualification does not mean much.
Pre-approval is when you fill out the application form called 1003, provide your tax documents,
paychecks, bank statements etc. Unless they did something miscalculation, your debt to income
ratio would have been a concern at the point of pre-approval.

However, pre-approvals are not perfect either. They even say "subject to" many verifications.

Other than finding another/additional co-signer, getting a grant from the city you live in, getting a 401K
withdrawal to make a larger down payment (or a 401K loan), getting a gift from a relative for the down payment, there is not much you can do about the loan at this time.

I'd have your agent go with you and talk with your loan officer to see what issues are there,
and ask for help to solve these issues.

Best of luck,

Irina Karan
Beachfront Realty, Inc.
0 votes Thank Flag Link Tue Apr 23, 2013
Getting a loan is not easy these days and you really need to use a lender that knows what they are doing. It sounds like the first person missed something or you increased your debt right before closing on your loan. There is not much you can do other than talking to another lender to see if you can get approved. Since you were not approved for a loan depending on the contract you may be able to get your funds back. You should speak with your agent and the lender to see where you stand. Sorry to hear that you feel mislead. Oh and the earnest money should have been a check going that went to escrow. If your agent isn't any help, talk to escrow for some help.

Good luck,

Lori Hanson
OC Homes Realty
DRE 01405146
0 votes Thank Flag Link Tue Apr 23, 2013
It is very important to trust your lender and your REALTOR. First, you shouldn't have to pay a REALTOR to help you find a home. The sellers pay the REALTOR. The lender should have sent you a list of things to give them ie: tax returns, bank statements, debt to ratio, etc. The bank can tell you ahead of time if you qualify or not BEFORE you start looking for a home.

I am sorry for your troubles.

Warmly,

Bridget
0 votes Thank Flag Link Tue Apr 23, 2013
It sounds as though you have been misled. A good lender would have had their ducks in a row.

The problem: You may not get the house and due to funding issues. You were misled..

The Solution: Try and get reimbursed by Network Funding. Write them a letter detailing the dates and expenses. The reasons you feel you were misled. Include that you are willing to go through great lengths to get your money back.

Also, get an approval from a reputable place. I have several.

Steve Alford
Orange County Real Estate Group
http://www.realestateoflagunabeach.com
888-863-7480
0 votes Thank Flag Link Tue Apr 23, 2013
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