Home Buyers are running in to an unexpected obstacle in moving in to a new home. Lenders who have promised the moon to newbie home buyers are having a hard time getting to closings on time. Home buyers who have been promised a 30 day application to closing time line are finding their lenders are taking longer than 30 days to get a loan closed. No, make that a lot longer than 30 days to get their mortgage loan closed.
These are not home buyers with “bad” credit, “iffy” credit or even “good” credit. We are talking about home buyers with “outstanding” credit scores, credit histories and good paying jobs. We are talking big down payments and low loan to value ratios. We are talking about some of the very best buyers in the marketplace.
So what gives? What can’t banks, credit unions and mortgage companies get these loans closed?
Home sellers are finding their moving schedules completely wrecked by the failure of these lenders to get the underwriting done on loans in time to close by the contract date.
Some of my sellers have had to
- Cancel moving companies or change moving dates (this costs a wallet full of money)
- Pay an extra months rents on an apartment lease.
- Delay the purchase of the house they were buying after closing of their first home
Guess who ending up eating the extra costs outlined above? If you guessed the buyer, you have guessed correctly. When the buyers needed an extension to close the loan my sellers asked for reimbursement of out of pocket expenses.
AND my home buyers who selected lenders on their own (ie not ones I recommended) are finding they have a lot of extra costs when their mortgage lender “needs a couple of extra weeks” to get the loan done. These buyers are looking at trying to figure out where they are going to live during those extra couple of weeks. Not an easy task on short notice.
How to find a lender who will get you to closing on time
- Ask your real estate agent who is getting the job done in their local market.
- Avoid Big Banks. Big banks are notoriously slow in underwriting loans. Mostly because they screwed up the process so badly in the go-go years and now have to deal with a maze of checks and balances in their own organization. An alarmingly high percentage of my buyers never even get to closing when working with a big bank. And no one is ever personally accountable for your loan application: “Press 1 for customer service”, “press 2 for English”.
- Avoid Credit Unions. I so hate having to list credit unions as a problem in getting loans closed but it is so true. Credit Unions have slowed down to a crawl in getting home purchase loans closed. My buyers who use credit unions almost never get to closings on time because of the foot dragging in credit unions mortgage departments. I love, love credit unions and do my banking with one of the local ones but I could not recommend them for a mortgage loan right now.
- Realize the ¼ percent advantage you see in the quoted rate of a no name lender will mysteriously disappear before you get to the closing table.
- Realize the ½ percent advantage you see in the quoted rate of a no name lender OR big name lender on the INTERNET never existed in the first place. Do not use an INTERNET LENDER unless you are refinancing.
If you are considering buying an Atlanta Georgia home, call me and I will recommend a local lender who can get you the the closing on time. Call Sally English at 770-939-3174 or send us an email.
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