This is the 5th time I have worked with this buyer. About 1995 she bought her first condo with me, sold that condo, bought a house, sold the house and moved to Boston, came back to the Bay Area, and just bought this home.
She was determined to buy a single family home and not a townhome or condo, even though, in this price range, it is VERY tough to get a single family home and most the homes in this price range are eaten up by all cash buyers. She made so many offers that I completely lost count of how many offers we actually wrote, but she was very motivated and determined to get into a single family home and did not want to settle for a condo or townhome.
Finally, we got lucky and was able to get this home locked in to contract. This home was a short sale and it took only 2 months to get lender approval, which isn’t too bad for a short sale, actually. Of course, for the 2 months, we were on pins and needles waiting for approval since she really wanted this home.
After getting loan approval, then the fun really began (sarcasm). The FHA loan was just a complete nightmare until closing day, and really, this is no exaggeration. She was preapproved for the loan, but once we got short sale approval and moving forward to closing, it was just one thing after another with the lender. They wanted every document imaginable, and asked for some documents multiple times. I don’t know if they were eating her documents or what.
After the lender finally got all the information, asking for more and more on a daily basis for 30 days, the buyer was pulling her hair out, it finally went to the underwriter for final approval. The underwriter determined that she was going to DECLINE the loan, I won’t go into details on why, but let’s just say the reasons were ridiculous and mind you this is all happening at the 11th hour of our transaction.
To save the deal, the buyer asked her dad to co-sign for the loan just to move forward and close. So, more jumping through hoops, the lender had to resubmit the file, the underwriter asked for everything under the sun for the father as well, and again asked for the same documentation multiple times.
This time around, the loan was approved with the cosigner and even once the loan was approved, the underwriter continued to ask for supporting documentation and paper after paper that the buyer had to jump through hoops to obtain…and FINALLY, the underwriter had all of the documents that she wanted and let the deal fund and close.
All parties were on pins and needles to close this deal. This transaction had to close by the end of the month because that was the amount of time that the seller’s bank gave them to close the short sale deal, so the seller was really stressed out. And, if it were to go beyond the approval time, the deal could have fallen apart and the seller could have faced foreclosure. The buyer was also stressed that the bank would come up with a reason not to close the loan since she had no trust in them from all the stress they put her through. It was just crazy.
But, of course, there is a happy ending. The buyer is now in her new home and happy that all the drama is in the past and she can now enjoy being a homeowner again. And, she qualifies for the $8000 Federal Tax Credit. By the time we closed this transaction, this price was a steal, so she walked right in to instant equity.
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