1/3 down and no loan?

Asked by F4sale, Los Angeles, CA Wed Jul 22, 2009

Another question popped into my head. I was wondering if anyone can answer it for me. I am a seller, and my buyer is putting 1/3 down and trying to get the rest in loans. joint loan- husband score near 760 and wife near 690. we have been in escrow for almost a month, our closing date is coming around and they don't have loan approval. why? is it their DTI?

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Emily Knell’s answer
Emily Knell, Agent, Huntington Beach, CA
Wed Jul 22, 2009
I just answered this question & brought up DTI, we're psychic.

They may have had some collection come up, or weren't honest with the lender about their expenses. Your agent should have the buyer's lenders' phone number. He/she NEEEDS to contact the lender & simply ask, "WHAT THE HECK IS GOING ON??".

Light the fire under the buyers & tell them you're canceling escrow & are going to be putting the home back on the market, tell them you're also not going to release their Good Faith Deposit. You need to get them to lay out their cards on the table. If they ARE seriously working on something & the lender feels it CAN be resolved, give them a reasonable extension to the contract.

Maybe they're looking for a 3rd co-borrower.

0 votes
Muriel Levin, Agent, Beverly Hills, CA
Wed Jul 22, 2009
They might have gone to one lender and then switch in the middle to a different lender because they liked the deal better. In that case they are going to be late because if it takes 45 days from teh beginning of the application, they started late, they will get there late. Ask about this and teh rest of the answers my colleagues talked about.
Good Luck and be patient....enjoy your hosue while you are still there...

Muriel Levin
(323)363 91 40
Web Reference:  http://www.muriellevin.com
0 votes
John B, , Studio City, Los Angeles, CA
Wed Jul 22, 2009
You need to check with your realtor about this clients because loan approval should be already in place.
Web Reference:  http://homesinsale.com
0 votes
Paul Visconti, Agent, Los Angeles, CA
Wed Jul 22, 2009
I would guess it's DTI issue being that the FICOs are decent. Many underwriters are backed up as well. What is the loan amount? It could be an appraisal issue as well. Have there been any appraisals yet?
0 votes
Judith Gotte…, Agent, Los Angeles, CA
Wed Jul 22, 2009
So it's not that they have been declined, but that they don't have loan approval yet, right?

Many lenders are very backed up in underwriting. Plus the new appraisal process takes longer than before. The appraisal has to be included in the final underwriting package. Depending on the mortgage broker's talent at preparing the package, one missing document can cause the loan to go to the back of the line when that item is finally provided. You didn't mention how long the escrow period is so I don't know how long you've been waiting but this is the way it is these days.
Web Reference:  http://JG4RealEstate.com
0 votes
Luke Allison, , Asheville, NC
Wed Jul 22, 2009
What is the loan amount? Is it conforming or non-conforming?

Luke Allison
Bank of America Home Loans
0 votes
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