Many moons ago... prospective borrowers used to write letters to the bank to explain derogatory credit. We had a woman with bad credit due to health issues who sent our Bank a heartfelt letter attached to a picture of an ovarian cyst, the size of a grapefruit.
We approved the loan.
(Oh the good ol' days of common sense underwriting!)
Yes this is an unconventional request but who really knows. The effort cost you nothing but a half an hour of time. What is it really going to hurt? You DO live in San Francisco...Just kidding.
Maybe there is something unusual about your situation and your loan broker knows that the underwriter is a sucker for a good story. (I doubt it but there are many strange things going on today.) Write the letter.
Maybe you want to call your agent and clarify.
Are you sure the realtor wants the letter for the Bank? Maybe she wants it for the seller since that type of letter is something agents advice the buyers to write so the sellers get to know a little information on who the buyer is and how serious he is about buying the house. The letter has a more personal touch and emotional so it makes a difference in a multiple offer situation when the seller is having a hard time deciding which buyer's offer to accept.
I have never heard of sending a letter like that to the bank. You may want to confirm with the agent as to who the letter is for.
I'm with my fellow Realtors on this one, we do not normally write letters to lenders, and, in fact, I doubt seriously that a bank would even consent to look at letter from the buyer. There are instances when the mortgage broker must send a note to the underwriter or the bank explaining issues pertaining to the home or clarifying the income, buying status or use of the home, but this is done by the mortgage broker or loan agent in response to, most commonly, a list of conditions needed to complete the loan.
Even if you are a buyer "on the fence" between approval for a loan and disapproval, a lender cares not that you "love the house" or "see yourself living in the home". The bank only cares that you can or cannot make the monthly payments on time.
Personally, I'm with Mack on this one. This baffling question is best answered by your realtor and the lender. Otherwise, writing such a heartfelt letter is likely to be an exercise in futility. Good luck!
Grace Morioka, SRES
Area Pro Realty
San Jose, CA
You're making us guess, when you would have the answer simply by asking the lender. Among the reasons, however, are homeowners purchasing another - often smaller - home as "owner occupants;" would you fall in to that category?
In many cases offers are submitted to the bank (asset management company) through a online platform or portal. For each offer submitted there is a place to input information and upload files and there is no "upload letter buyer wrote stating they love the house" button.
I think your agent is on auto pilot here.
Nothing to add here other than to rally with my fellow Realtors and say yes, that is strange to write a letter to the bank. Strange indeed.
Great question! It made me chuckle.
Banks make loan decisions based on a buyer’s financial qualifications (monthly income vs. monthly obligations; debts; credit score; etc.) in conjunction with their appraised valued of the collateral (the house). Emotional appeals do not get consideration. I think your agent’s suggestion is unrealistic.
A buyer’s emotional appeal to the seller expressed in writing and accompanying the offer has been know to help sway the decision of the seller on occasion but only if the seller is a natural person and not a REO seller or short sale lender/seller.