ATTACK OF THE PHANTOM GUIDELINE!

By
Mortgage and Lending with Wholesale Mortgage Services Individual NMLS ID 331194

That's right people, its time for another episode of the "Attack of the Phantom Guideline"! What's that you say, you're not familiar with that show? Me neither, but apparently it comes on whenever i am trying to close a cream puff of a loan. You know, it's the show where lenders make up underwriting guidelines that no one (me) has ever seen or heard of before, and then have no way of backing them up.

This week's episode: "The 20% Square footage guideline."

Our show begins with our mild mannered mortgage broker, Moe Jazzei, who we find has just received his conditional loan approval from his preferred lender, Nuntrust Mortgage, who has taken eight days to underwrite his loan. Eager to close his loan, Moe quickly reviews his approval. Loan to value: 46% -check. Credit score: 795-check. Loan term: 15 year - check. Interest rate: 4.375 - check.

Now, on to the underwriting conditions. Great Scott! There is only one. But what's this? OH NO!! It's the PHANTOM GUIDELINE!!! The underwriter is requesting two new comparable sales due to square footage being off by more than 20%!!! That's right, unbeknown to our intrepid mortgage broker, apparently the square footage of the comparable can not be 20% greater or less than that of the subject property!! To make matters worse, she is quoting guideline!!

This can't be, Moe says to himself. I have never heard of this. They must be mistaken. Trying to keep his composure, Moe decides to contact his appraiser, as he realizes even though he is a very knowledgeable broker, perhaps this is a section of the Fannie Mae underwriting guide he just plain missed. But much to his dismay, his appraiser of twenty years experience is also puzzled. "Never heard of that one", he quips.

Getting no satisfaction from his appraiser, Moe decides to contact the underwriter. After several phone calls and messages (shocker) to the lender, Moe finally reached the underwriter.

He asks, "Is this a Fannie Mae guideline or a Nuntrust guideline?" "Fannie Mae", she says. Moe quickly responds, " I cant find it in the guide, do you have a copy?" " No, I don't", she quickly replies." "How am i supposed to get it then?" "Check with Fannie Mae." " I did, and i could not find it." " Well,  if you don't have it, and Fannie Mae doesn't have it, how am i supposed to know it exists?" "I will have to get back to you on that one".

Will the underwriter be able to obtain the Phantom Guideline in writing? Will our broker be able to get this loan closed before his locks expires? Tune in next week kids for the exciting conclusion of " Attack of the Phantom Guideline!"

Comments (9)

Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

I like the names you selected for this story Moe!  It's definitely getting tougher to get the mortgages done.

Jun 14, 2009 11:24 PM
Chip Jefferson
Gibbs Realty and Auction Company - Columbia, SC

I am still on vacation at Hilton Head Island. I had a few minutes with my cofee to stop by and say hello. Have a great week.

Jun 14, 2009 11:46 PM
Sara Goss
HatmakerGroup.com GMAC Real Estate - League City, TX
Realtor - Houston Bay Area, Texas

Entertaining post, will tune in next week for the final episode. Tell Moe I said hello.

Jun 14, 2009 11:54 PM
Joseph Mazzei
Wholesale Mortgage Services - Tampa, FL
Why pay retail you you can get it Wholesale?

Thanks Gabe, the names were changed to protect err... the innocent.

Laura, sounds like a great vacation, spent some time in south carolina myself.

Sara, i will say hello to Moe for you.

Jun 15, 2009 12:52 AM
Tony Grego, 317-663-4173 #1 Trade Association for Alternative Inv
REISA - 317-663-4173 - Indianapolis, IN

You know in the long run it will not matter. The underwriter is mad and will keep finding reasons to delay/approve the deal.

If you want to get it closed find another lender.

Tony

Jun 15, 2009 01:09 AM
Josh David
Bridgeview Bank Mortgage - Tampa, FL
Purchase Specialist... www.joshdavid.us

Great posting, this is why it is substantial to do business w/a direct lender and in house under writing team at the branch location.

JD

Jun 15, 2009 11:12 AM
Joseph Mazzei
Wholesale Mortgage Services - Tampa, FL
Why pay retail you you can get it Wholesale?

Tony - lets just say that Moe was victorious in his struggle. I will divulge what happened in my next post.

Josh -  Thanks Josh, trying to keep it light in these heavy times. I have worked for a direct lender in the past, with mixed results. Its all about being in with the right group of people, no matter if its retail or wholesale.

 

 

Jun 15, 2009 04:23 PM
Peter Weiss
Pacific Residential Mortgage Corp - Laguna Niguel, CA

Glad to hear Moe was victorious!

I thought he was going to get the"our investor doesn't go by Fannie guidelines" routine. So let's chalk one up for the little. Good job Moe!

pweiss

Oct 30, 2009 03:46 PM
Joseph Mazzei
Wholesale Mortgage Services - Tampa, FL
Why pay retail you you can get it Wholesale?

pweiss, i've gotten that on in the past also. but now the lenders and investors alike are changing guidelines more often that their underwear! :)

Oct 31, 2009 11:07 AM