Bank of America loan application derailed by loan officer who shoots first and never asked a question   

Buyer’s offer on a short sale duplex  in Alameda CA was accepted. He was going to put down $250K on a $450K property, and borrow the rest.

One would think that with such a substantial down payment, the buyer is hardly a credit risk.

After receiving the HAFA short sale approval and the buyer and his agent were formally notified, they worked on getting the loan processed. Three weeks later, the loan officer said they were backed up, and will need more time. The seller agreed to a one week extension for he loan approval.

Another week passes, and the loan officer said they have all the documents from the buyer, and are simply “lining up” for underwriter approval. But just the same, could they get an extension?

The short sale negotiator responds via email, granting approval, and indicates on the Request for Approval of Short Sale (RASS for HAFA) form when to close escrow.

DISASTER!Derailed

Loan officer emails the buyer’s agent that

“I don’t feel comfortable with this loan and we will have to decline this loan as the contract had been altered.”


WHAT?

Nothing changed: same price, same terms, same conditions.

The only thing that did change was the closing date, and it was noted on the RASS form

No one could understand why the loan officer declined the loan, especially this close to getting underwrited approval.

Buyer’s agent attempts to escalate, gets nowhere, and gets no viable explanation.. Listing agent even contacts Bank of America Twitter   to help them. But Buyer, being extremely frustrated, especially after having spent money on inspections and appraisal, gives up and cancels the agreement.


WHAT HAPPENED?

They asked for the extension. When it was granted, and the change was made on the RASS form, they arbitrarily decline the loan without getting an understanding of what transpired due to their own delay.

 
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6 Comments on Bank of America loan application derailed by loan officer who shoots first and never asked a question

MAR
06
2012
199,061 Points 5 Featured Posts Outside Blog Called Shot Master

All I can say is Oh My! Perhaps a reason not to use the big banks to get your loan? Does that loan officer have a superior, bet he does, too late now but....
2:50pm • #1
201,876 Points 2 Featured Posts Called Shot Master

As one of my favorite clients says frequently, "We are surrounded by idiots."  Ya can't fix stupid.,
6:32pm • #2
MAR
07
2012
1,065,189 Points 68 Featured Posts Outside Blog Called Shot Master

Our MLS listings...traditional or short say...offers must be accompanied by preapproval/qualification from locally approved lender. Truth is that we do not "approve" of all of them because of bad experiences...and at least here...we can tell the buyer they will have to go elsewhere in order not to put our Sellers at risk of not closing.
3:44am • #3
MAR
09
2012
229,869 Points 9 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

We should talk about the right and wrong places to place your loans so they will close on time.  From what you described, this was just an in-experienced loan officer that dropped the ball, thus costing you a sale.  Stay away from the big banks as they are going after the HARP 2 refinances and the purchases are going to drop through the cracks. 
8:40am • #4
466,050 Points 50 Featured Posts Called Shot Master

Pacita, I read recently that BoA will not be selling their mortgages to Fannie Mae. They've had to pay them a bundle in a settlement. I would never suggest a buyer get a BoA mortgage loan. They are not equipped to handle loan underwriting. Also, another big bank that starts with a W is not good either. The loan app takers are just order takers and have no clue and when the buyer's loan gets to underwriting, it's oops, sorry. In this climate of short sales and tight closing dates, this is unacceptable. Stay away from the big ones and use a direct lender is my mantra!
8:53am • #5
617,086 Points 60 Featured Posts Localism Sponsor Outside Blog Hit Router Attended Rain Camp Called Shot Master

Mary -- I encouraged the buyer's agent to escalate the problem. I don't know that she made the effort

Marge -- I totally agree. I feel sorry for the buyers and their agent.

Sally and David -- these buyers were preapproved. But we don't know what happened at the very last minute -- literally -- that made their loan officer not "feel good about the loan" and then declines it without asking questions or clarification from anyone.

Doug -- that's why one of our essential partners in a transaction is a knowledgeable, resourceful and reliable lender. I'm sure your clients think very highly of you

Pamela -- the sad part is that many of the REOs insist that buyers are preapproved by these big banks before submitting an offer. It's wreaking havoc on buyers whose credit scores are not high to begin with.
10:01am • #6

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Pacita Rainmaker_large

Pacita Dimacali - ePRO, SRES, CDPE, MBA Alain Pinel in Alameda County CA

Oakland, CA

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Alain Pinel

Address: 6211 La Salle Ave, Oakland, CA, 94611

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