Home Buying in El Sobrante>Question Details

Nawang, Home Buyer in El Sobrante, CA

I'm currently in the bay area in California and 2 months ago I was pre-approved by BOA and our offer for a home was accepted and we made an

Asked by Nawang, El Sobrante, CA Fri Sep 4, 2009

initial deposit of 10k, now when the time has come for the escrow, the underwriter has denied the loan, which our loan agent assured us we'd get. we have already extended the time for the closing, but we risk to lose our deposit if we don't close on time. we are considering other loan options now. somebody please help!! very desperate and worried.thank you

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If your loan has not been approved, BofA must provide you with the denial letter that will show you the reasons for the denial. If these items can be addressed or revisited, you should do that in the interest of keeping the deal intact. Sometimes, mistakes are made or things overlooked, and a conversation with your loan officer may get to the bottom of it.

If the loan was denied due to the property/appraisal, you will need this information if you wish to continue with the seller.

As with all things in life, before correcting the problem, you must know what it is.

Let me know if I can help at any time --- either with additional perspective or with a new loan setup.

You know more than you think,

Rob Spinosa
0 votes Thank Flag Link Mon Sep 7, 2009
Anyone not buying with cash and getting financing today really needs as long a financing contingency as you can possibly negotiate. There are all kinds of new regulations coming down on the mortgage business + very, very tough underwriting guidelines that are causing delays and loans to be denied. But if you have a highly skilled and super proactive loan officer, you can avoid many of these issues.

And even if your loan is approved and you are a pristine borrower, there can be issues with the appraisal. The HVCC appraisal process can take 10+ days for an appraisal to be fully turned around. And then it can take another week for the lender to fully review the appraisal and possibly cut the value. So it is also smart to have a long appraisal contingency. The problem is sellers (especially REO's) want very SHORT contingencies! Which sets everyone up for some serious stress!

What was the reason your were given for the denial?
0 votes Thank Flag Link Sat Sep 5, 2009
What you are seeing is common in this market. Initial approvals are automated based on set criteria and are bordering on worthless. Until you have a contract bank underwriters won't even look at the paperwork provided to the loan agent, even though the loan agent has verified the desktop information. Now thay you, your agent, and the loan agent have all done what they are supposed to do, you have paid for your appriasal and inspections, and the bank had given their initial blessing, some underwriter for some unknown reason pulls the rug our from underneath you or changes the loan terms. It's an insane process.

Here is what I can say. 1) Have you agent look at your contract look for I's to be dotted and T's to be crossed. 2) If he can't find any then go to his broker and have thir in house counsel step in if necessary and 3) Your loan agent should call the bank and find out what happened and rectify it. Don't give up hope, but make sure you get help.
Web Reference: http://bob2sell.com
0 votes Thank Flag Link Sat Sep 5, 2009
One of the things that I say now about mortgage guidelines is that last year's guidelines are ancient history, and yesterday is already old news. Unfortunately, guidelines change all the time, and a two month old pre-approval may not mean anything based on today's guidelines. Also, not all loan officers are as familiar with all guidelines as others. BOA hires students right out of college, and when you are talking to them on the phone, you have no idea whether they are 24 or 44, and they can talk a good game. However, they don't look at things the way an experience loan officer would, or see what an underwriter would see. Did your credit scores drop? Did you have an unexplained large deposits? Can you qualify for PMI under the current guidelines? Have you applied for a conventional loan and perhaps would have been better off with FHA? Even on FHA there are some changes taking place. Banks are increasing credit score requirements all the time.
I agree that finding an independent mortgage broker, preferrably someone who has been recommended by a friend or colleague who has used them. If there is a loan out there for you, they will find it. If they are knowledgeable and honest enough with you, they will tell you that there is not.
0 votes Thank Flag Link Sat Sep 5, 2009

Hopefully you didn't clear your contingencies yet., Two of your contingencies should state that the offer is contingent on the property appraising for the purchase price, and for your loan to be approved within a certain period of time. If not, you can back out of the agreement and get your deposit back.

Try an independent mortgage broker. But before you do, what is the reason why your loan was denied?
Did the property not appraise for what you offered to buy it? If so, have you negotiated with the seller to sell at the appraised value?

Does your current income not qualify for the purchase price?

Anyway, try calling this independent broker. He may be able to help. He is here in the East Bay.

Garrick Werdmuller
Branch Manager
Personal Mortgage Consultant
Commercial, Residential, Small Business Lending
510.282.5456 DIRECT
510.225.0382 FAX

Good luck!
0 votes Thank Flag Link Fri Sep 4, 2009
You should have a mortgage contingency in your contract. Usually with a date to have the financing confirmed. In your offer, you get to choose either cash or financing and surely you picked financing... are you following me on this?

If you are within your contingency period, you can cancel your contract and get your deposit back.

Send me an email if you need more info or explanation.


Web Reference: http://www.onmarco.com
0 votes Thank Flag Link Fri Sep 4, 2009
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