Ok, Sorry I Have to Make the Call...I Think That Lenders are Off the Deep End Here
I agree with every thing in this blog post. It is a great read. Every bank executive should be reading this instead of sitting around and raking in the hard earned bucks of the folks they pillaged over the last few years!! Thanks Linda.
This is NOT a post about the causes of the real estate market collapse. Many causes, many guilty parties, many innocent bystanders caught in the crossfire. One of my favorite topics of debate and conversation. But not today.
Still...despite the multifactorial nature of the meltdown, I think that MOST of us would agree that there was, well just perhaps, a need for a bit of tightening in lending standards a few years ago. Maybe an actual job and actual income WAS, after all, a good idea. Who knew? Maybe some documentation of said income made some sense. Who would have thought? Maybe even providing some extra documentation along the way, FICOs and such, was a worthwhile endeavor when hundreds of thousands of dollars were being loaned. I totally get that, and I try hard to be patient and sympathetic as my buyers' lenders, the good ones that are still employed, now work to create a file to be reckoned with.
But, somewhere along the line towards making things shipshape, we got maybe just a smidgeon carried away. Don't get me wrong...I am a doctor, I am well versed in the art of ass covering. Spiffing the chart...been there, done that. Has nothing to do with improving patient care; I get it. Heck, I have to deal with the Joint Commission on Accreditation of Hospitals on a regular basis, whose primary interest it is to discover heinous discrepancies that must be corrected immediately, else why would their future intervention be needed? But I digress...
Today, I phoned a lender to let h
er know that, although SHE had a holiday yesterday, I was hard at work arranging for a deal to close escrow on a time frame they had established. Need to be on record by Friday, so I'm told. Ok, so on this deal, which already has two appraisals, two inspections and a slew of repairs done by the seller, I have just arranged for a reinspection to assure that all repairs they require are completed. "But what about the appraisal?" she says. What appraisal??? "Well the appraiser called out for some repairs too." Um...yes, he noticed that a couple of outlet covers were missing, is that what you mean? "It needs to be rechecked," she explains. So, you are telling me that you need to waste an appraiser's time, likely several hundred dollars worth, returning to the property to verify that two plastic, $1.50 each, outlet covers were screwed into place? You have GOT to be kidding me! Don't you think the inspector, who will be there reinspecting repairs, probably has the expertise to make that call? Guess you just can't take that chance when ass covering is at stake.
Poll time: how many of you think that the reason the real estate market tanked is because banks weren't nit-picking trivial home repairs? Anyone? Bueller? ANYONE?
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Copyright © Linda S. Humphrey, all rights reserved
Linda S. Humphrey, M.D., CDPE, e-PRO, EcoBroker, GREEN
Broker/Owner - Humphrey Home Connections Realty, LLC
cell: 775-287-4665
office: 775-232-8515
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